BANCROFT 
LIBRARY 


THE  LIBRARY 

OF 

THE  UNIVERSITY 
OF  CALIFORNIA 


FOREIGN  COMMERCE  SERIES  •  Dumber  Three 


Our  South  American  Trade 
and  its  Financing 


FRANK  O'MALLEY 


THE  NATIONAL  CITY  BANK 
OF  NEW  YORK 


Foreign  Commerce  Series 


I —  Trading  With  Our  Neighbors 
in  the  Caribbean. 
%  OSCAR  P.  AUSTIN 

II  —The  Function  of  Imports 
in  Our  Foreign  Trade. 
Sy  GEORGE  E.  ROBERTS 

III  — Our  South  American  Trade 
and  Its  Financing. 
®y  FRANK  O'MALLEY 

IV -Trading  With  the  Far  East. 
*By  OSCAR  P.  AUSTIN 

[/#  Preparation] 

V  — The  Development  of  Scandinavian 
American  Trade  Relations. 

T$y  F.  C.  SCHWEDTMAN 
[/»  Preparation^ 


OTHER  volumes  in  this  series,  which  shall  deal  with  current 
problems  affecting  foreign  trade,  and  with  financial,  economic 
and  commercial  conditions  in  various  sections  of  the  world,  will 
be  published  later  by  The  National  City  Bank  of  New  York. 


OUR  SOUTH  AMERICAN  TRADE 
AND  ITS  FINANCING 


Buenos  Aires  Branch 
The  National  City  Bank  of  New  York 


OUR  SOUTH  AMERICAN  TRADE 
AND   ITS   FINANCING 


How  to  ^Develop 

How  to  Finance  and  How  to  Hold  Trade 
South  ^America 


*By  FRANK  O'MALLEY 

^Assistant  Cashier 
THE  NATIONAL  CITY  BANK  OF  NEW  YORK 


LAWS  AND  CUSTOMS  OF  THE  VARIOUS  SOUTH  AMERICAN 
COUNTRIES  GOVERNING  DRAFTS  FORWARDED  FOR  COLLEC- 
TION I  THEIR  PROTEST  I  CUSTOM  HOUSE  CLEARANCE  AND 
REGULATIONS  I  DOCUMENTATION  OF  SHIPMENTS  !  INSUR- 
ANCE OF  SHIPMENTS  IN  FOREIGN  WAREHOUSES  :  SOUTH 
AMERICAN  STORAGE  FACILITIES  I  STAMP  CHARGES  : 
PARCEL  POST  I  THE  LICENSING  OF  AMERICAN  REPRE- 
SENTATIVES AND  SALESMEN  I  THE  CUSTOMS  ENTRY  OF 
SAMPLES  :  THE  OPENING  OF  BRANCH  OFFICES  OF  AMERI- 
CAN FIRMS  I  THE  RUBRICATION  OF  BOOKS  OF  ACCOUNT, 
TRADE  MARKS,  ETC. 

"frith 

GENERAL  INFORMATION   OF   VALUE  TO   AMERICAN    FIRMS 
INTERESTED   IN    SOUTH    AMERICAN    TRADE 


1920 

FOREIGN    COMMERCE   SERIES 

Dumber  Three 


4443 


FOREWORD 


}ITH  the  advent  of  peace,  the  return  of  the  world 
to  normal  conditions  must  of  necessity  be  slow 
and  gradual  after  the  tremendous  upheaval  which 
has  convulsed  civilization  for  the  past  five  years. 

For  some  time  prior  to  the  war,  the  foreign  trade  of  the  United 
States  showed  a  healthy  increase;  but  the  great  conflict,  in  con- 
verging the  thought  and  energies  of  Europe  upon  war  and  its 
necessities,  gradually  converted  the  American  nation  into  the 
temporary  work  shop  and  supply  house  of  the  world. 

In  an  endeavor  to  meet  this  unprecedented  demand  for  its 
products  and  manufactures  of  every  description,  with  the  added 
strain  of  becoming  in  1917  an  active  belligerent  in  the  conflict, 
there  have  been  invested  in  the  United  States  since  1914,  in 
new  productive  enterprises  and  machinery,  more  than  six  bil- 
lions of  dollars. 

If  these  new  forces,  in  addition  to  those  in  operation  before 
the  war,  are  now  to  be  kept  in  productive  activity,  it  becomes 
incumbent  upon  the  United  States  to  develop  foreign  outlets 
to  take  over  the  surplus  to  be  expected  from  this  production. 

It  is  the  realization  of  this  future  probability,  in  conjunction 
with  the  forced  development  of  our  foreign  trade  as  a  result 
of  abnormal  world  conditions,  which  has  radically  changed  our 
attitude  towards  foreign  business  and  particularly  towards  the 
trade  of  South  America.  The  large  international  American  com- 
panies have  enjoyed  a  constantly  increasing  foreign  business 


for  many  years  past,  statistics  indicating  that  American  foreign 
trade  doubled  between  the  years  1903  and  1913. 

The  impetus  now  being  given  our  foreign  endeavors,  how- 
ever, is  such  as  only  a  world  crisis  could  have  brought  about, 
and  the  indications  are  that  American  business  is  gradually  ex- 
panding adequately  to  cope  with  the  world  demand  upon  it. 

The  attitude  of  South  American  business  men  toward  us  is 
likewise  undergoing  a  change  in  our  favor.  Prior  to  the  war, 
Europe  practically  dominated  South  American  markets,  but  the 
greater  familiarity  now  developing  along  commercial  lines  be- 
tween North  and  South  America  is  gradually  replacing  with 
confidence  and  respect  the  feeling  of  prejudice  and  distrust 
which  unfortunately  has  hitherto  prevailed. 

Correspondence  received  by  The  National  City  Bank  of  New 
York,  from  merchants  throughout  the  United  States  who  are 
following  the  trend  of  the  times  in  looking  to  South  America  for 
the  extension  of  their  business,  indicates  a  widespread  desire  for 
information  concerning  the  modus  operandi  of  the  financial  and 
commercial  operations  in  connection  therewith. 

It  is  in  an  endeavor  to  supply  this  data  that  we  have  com- 
piled the  practical  information  to  be  found  in  these  pages. 


Our  South  American  Trade  and  its  Financing 


FOREIGN  BRANCH  BANKS 

A>  an  evidence  of  its  faith  in  the  future  of  American  foreign 
trade,  The  National  City  Bank  of  New  York  has  been  prepar- 
ing during  the  past  five  years  for  the  increased  momentum  which  it 
was  foreseen  must  eventually  be  given  to  our  efforts  in  this  direction. 
We  have  now,  July  i,  1920,  in  active  operation  throughout  the 
world,  eighty-five  branches,  including  twenty-nine  branches  of  the 
International  Banking  Corporation,  now  included  in  the  organization 
of  The  National  City  Bank  of  New  York.  These  branches  are  located 
in  the  following  countries,  and  are  supplemented  by  correspondent 
banks  in  practically  every  important  commercial  city  of  the  world. 

BRANCHES  OF  THE  NATIONAL  CITY  BANK.  OF  NEW  YORK 


ARGENTINA 
BUENOS  AIRES 
Sub-branch 
PLAZA  ONCE 

ROSARIO 

BRAZIL 
BAHIA 

PERNAMBUCO 
PORTO  ALEGRE 
Rio  DE  JANEIRO 
SANTOS 
SAO  PAULO 

BELGIUM 
ANTWERP 
BRUSSELS 

CHILE 
SANTIAGO 
VALPARAISO 

COLOMBIA 
BARRANQUILLA 
BOGOTA 
MEDELLIN 

CUBA 

ARTEMISA 

BAYAMO 

CAIBARIEN 


CAMAGUEY 
CARDENAS 

ClEGO    DE   AVILA 
ClENFUEGOS 

COLON 
CRUCES 
GUANTANAMO 
HAVANA 

Sub-branch 

CUATRO  CAMINOS 

Sub-branch 

GALIANO 
MANZANILLO 
MATANZAS 
NUEVITAS 

PlNAR    DEL    RlO 

PLACETAS  DELNORTE 
REMEDIOS 
SAGUA  LA  GRANDE 
SANCTI  SPIRITUS 
SANTA  CLARA 
SANTIAGO 
UNION  DE  REYES 
YACUAJAY 

ITALY 
GENOA 


PERU 


PORTO  RICO 
PONCE 
SAN  JUAN 

RUSSIA 

*Moscow 
*PETROGRAD 

SOUTH  AFRICA 
CAPE  TOWN 

SPAIN 

BARCELONA 
MADRID 

TRINIDAD 
PORT  or  SPAIN 

URUGUAY 
MONTEVIDEO 
Sub-branch 
CALLE  RONDEAU 

VENEZUELA 

CIUDAD  BOLIVAR 

CARACAS 

MARACAIBO 

*  Temporarily  closed. 


[  7 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


BRANCHES  OF  THE  INTERNATIONAL  BANKING  CORPORATION 


CALIFORNIA 

INDIA 

SANTIAGO  DE  LOS 

SAN  FRANCISCO 

BOMBAY 

CABALLEROS 

CALCUTTA 

SANTO  DOMINGO 

CHINA 

RANGOON 

CITY 

CANTON 

HANKOW 

JAPAN 

PHILIPPINE 

HARBIN 

KOBE 

ISLANDS 

HONGKONG 

YOKOHAMA 

PEKING 

JAVA 

MANILA 

SHANGHAI 

BATAVIA 

TIENTSIN 
TSINGTAO 

SOERABAYA 

PANAMA 

DOMINICAN 

COLON 

ENGLAND 

REPUBLIC 

PANAMA 

LONDON 

BARAHONA 

PUERTO  PLATA 

STRAITS    SETTLE- 

FRANCE 

SANCHEZ 

MENTS 

LYONS 

SAN  PEDRO  DE 

SINGAPORE 

MACORIS 

THESE  BRANCHES  will  be  further  supplemented  as  world  conditions 
normalize  and  as  conditions  at  strategic  points  indicate  the  advis- 
ability of  establishing  further  outposts  in  American  banking  to  assist 
in  the  broadening  of  foreign  markets  for  American  trade. 

SERVICES  RENDERED  BY  BRANCH  BANKS 

THE  facilities  which  our  foreign  branch  banks  enable  us  to  offer 
our  clients  may  be  epitomized  as  follows  : 

[  i  ]  The  collection  of  drafts  drawn  upon  foreign  houses. 

[  2  ]  The  protection  of  the  interests  of  American  merchants  through 
the  control  of  "To  Order'*  shipments  until  payment  or  accept- 
ance by  foreign  purchaser  of  the  corresponding  draft. 

[  3  ]  The  protest  of  drafts  where  drawer  so  instructs. 

[  4  ]  The  securing  of  legal  services  in  foreign  countries  through  our 
own  foreign  attorneys. 

[  5  ]  The  creation  of  foreign  markets  for  dollar  exchange. 

[  6  ]  The  collection  of  credit  data  on  foreign  houses,  and  the  con- 
tinued study  of  foreign  market  and  credit  conditions,  reports 
on  which  are  constantly  forwarded  to  New  York  for  the  in- 
formation of  our  American  clients. 

[   8  ] 


BRANCH  BANK  SERVICES 


[7]  The  forwarding,  to  our  branch  banks,  of  credit  information 
upon  firms  represented  by  American  travelers,  thus  enabling 
these  representatives  to  refer  foreign  merchants  to  our  branches 
for  credit  information  concerning  their  principals. 

[  8  ]  The  collection  of  trade  data  covering  the  possibilities  in  foreign 
countries  of  American  manufactures  and  products  of  every 
description. 

[9]  The  study  of  foreign  market  conditions  covering  commodities 
produced  in  the  foreign  country  for  export. 

[10]  Upon  request,  letters  of  introduction  and  letters  of  credit  are 
issued  from  our  New  York  office  to  our  foreign  branch  corre- 
spondent banks  placing  at  the  disposition  of  our  American 
clients  or  their  representatives  who  may  be  traveling  the  varied 
facilities  of  our  foreign  offices  and  connections. 

[11]  Branch  banks  through  coming  directly  into  contact  with  the 
trade  and  financial  problems  arising  in  both  the  export  and 
import  field  assist  materially  in  their  solution  through  the  pub- 
licity of  the  results  of  special  study  of  such  matters. 

[12]  The  assistance  rendered  in  the  development  of  American  foreign 
commerce,  both  import  and  export,  through  the  direct  banking 
facilities  afforded  at  home  and  abroad  and  in  general  through 
the  bringing  about  of  a  far  better  commercial  understanding 
between  this  country  and  the  countries  in  which  our  branch 
banks  are  functioning. 

Credit  Service 

ESSENTIALLY  the  most  important  service  rendered  to  both  our 
American  and  foreign  clients  is  through  the  medium  of  our  efficient 
credit  service.  This  we  have  developed  covering  not  only  every  State 
of  the  United  States  but  likewise  every  country  in  which  we  have 
established  branches.  To  our  American  clients  we  offer  a  credit  service 
on  South  America  which  is  the  equivalent  of  that  offered  on  domestic 
commerce  by  the  great  commercial  agencies  in  this  country. 

Foreign  Credit  Data 

WITH  EVERY  BRANCH,  we  have  established  a  Credit  Depart- 
ment with  a  competent  staff,  the  members  of  which  devote  their 

[  9   1 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

entire  time  to  securing  detailed  information  concerning  the  business 
community  within  their  jurisdiction.  This  data  is  kept  on  file  at  our 
New  York  office,  and  should  be  of  incalculable  value  to  our  clients 
interested  in  South  American  trade.  One  of  the  obstacles  encountered 
hitherto  in  our  relations  with  South  America  has  been  the  lack  of 
reliable  credit  data  on  merchants  in  that  part  of  the  world,  rendering 
it  practically  impossible  to  extend  time  on  sales. 

With  the  service  which  we  are  now  in  a  position  to  offer  through 
our  Credit  Department,  however,  American  merchants  should  be  en- 
abled to  accord  to  their  foreign  clients  the  same  relative  credit  facilities 
which  they  would  be  disposed  to  accord  firms  of  like  credit  standing 
in  this  country.  This  does  not  mean  that  we  are  to  extend  the  same 
long  terms  which  were  accorded  to  South  American  merchants  by 
Europe  before  the  war,  but  it  does  render  possible  the  elimination  of 
the  exaction  of  cash  at  New  York,  or  against  documents  at  destina- 
tion, in  those  instances  where  the  credit  information  indicates  that 
the  moral  and  financial  responsibility  of  the  foreign  house  entities  it 
to  more  consideration. 

Credit  Data  on  American  Houses 
Filed  with  our  Foreign  Branches 

THIS  SAME  SERVICE  will  be  found  to  be  of  value  to  our  American 
customers  who  contemplate  sending  travelers  to  the  South  American 
field,  inasmuch  as,  if  so  requested,  we  shall  forward  credit  information 
on  American  firms  to  our  branches  within  the  itinerary  to  be  covered 
by  their  travelers.  This  will  enable  the  representative  of  the  house, 
when  approaching  a  foreign  merchant,  to  inform  him  that  the  re- 
sponsibility of  the  American  firm  he  represents  may  be  investigated 
through  the  local  branch  of  The  National  City  Bank  of  New  York, 
thereby  establishing  a  feeling  of  confidence,  an  element  which  without 
this  service  must  be  sadly  lacking  between  houses  separated  by  per- 
haps thousands  of  miles. 

This  service  is  without  charge,  and  is  at  the  complete  disposition 
of  our  foreign  and  American  clients. 

Commercial  Department 

EVERY  BRANCH  established  throughout  South  America  is 
equipped  with  a  Commercial  Department  in  charge  of  a  competent 
trade^staff,  the  members  of  which  devote  their  entire  time  and  efforts 

[10] 


FOREIGN  DISTRIBUTING  AGENCIES 


to  the  collection  of  data  and  information  for  the  compiling  of  reports 
on  every  phase  of  the  commercial  field  in  their  particular  territory. 

These  staffs  study  foreign  markets  with  a  view  to  their  availability 
for  American  merchandise  and  development.  They  endeavor  to  famil- 
iarize the  foreign  merchant  with  the  possibilities  of  his  particular 
field  for  the  placing  of  American  merchandise  just  as  the  Foreign 
Trade  Department  of  the  Home  Office  in  New  York  is  endeavoring 
constantly  to  bring  before  the  American  merchant  the  potentialities 
of  the  various  South  American  countries  for  practically  every  class 
of  American  manufactures. 

While  our  branches  are  at  the  disposal  of  our  American  clients  for 
securing  information  relative  to  the  possibilities  of  different  lines  of 
merchandise  in  the  foreign  field,  we  do  not  undertake,  excepting  under 
unusual  circumstances,  to  sell,  market,  or  store  merchandise,  or  to 
distribute  samples  thereof.  We  have  in  our  files,  however,  the  names 
of  reliable  houses  in  the  different  South  American  countries  through 
whom  such  functions  may  be  performed. 

FOREIGN  DISTRIBUTING  AGENCIES 

OUR  South  American  clients  are  constantly  requesting  that  they 
be  placed  in  communication  with  American  houses  desirous  of 
having  their  product  introduced  into  South  America  through  estab- 
lished foreign  houses  acting  as  distributing  agents  for  one  or  more 
countries.  We  have  assisted  through  this  medium  in  establishing  rela- 
tions between  thousands  of  North  and  South  American  concerns. 

Caution  in  the  Arrangement  of  Exclusive  Agencies 

IT  is  NECESSARY  to  use  discretion  in  the  matter  of  granting 
exclusive  agencies  covering  one  or  more  countries.  Should  an  exclusive 
agency  of  an  American  product  be  given  to  a  merchant  in  the  Argen- 
tine to  cover  say  Brazil,  Uruguay,  Chile  and  the  Argentine,  it  would 
be  inadvisable  to  refer  Brazilian  or  Chilean  merchants  to  the  Argen- 
tine distributor  for  their  requirements,  inasmuch  as  the  product  could 
be  delivered  from  the  United  States  to  Brazil  or  to  Chile  at  a  lower 
freight  rate,  and  consequently  at  a  lower  cost  than  would  be  possible 
if  distribution  were  to  be  made  from  the  Argentine.  In  other  words, 
the  granting  of  exclusive  territory  should  be  restricted  within  reason- 
able limits,  inasmuch  as  the  doubling  back  of  freight  charges  rendered 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

necessary  under  an  exclusive  agency  if  granted  in  the  form  described 
could  easily  increase  the  cost  to  a  point  where  it  would  interfere 
with  the  profitable  sale  of  the  product. 

SELLING  TERMS 

IF  a  permanent  South  American  business  is  to  be  developed,  it  will 
be  necessary  for  American  merchants  to  accord  time.  The  exaction 
of  "Cash  New  York"  or  "Cash  Against  Documents  Destination"  im- 
plies a  lack  of  confidence  which  is  justly  resented  by  South  American 
firms  of  known  responsibility.  There  may  have  been  some  excuse  for 
this  attitude  on  the  part  of  American  merchants  before  the  establish- 
ment of  branches  in  South  America  of  American  banking  institutions. 
Now,  however,  with  the  twenty  branch  banks  which  this  institution 
has  in  actual  operation  in  the  various  South  American  countries,  the 
credit  facilities  which  we  are  in  a  position  to  offer  to  our  clients,  and 
which  are  treated  of  in  detail  under  "Credit  Service,"  should  permit 
of  American  merchants  granting  to  South  American  houses  of  proven 
responsibility  the  same  relative  credit  terms  accorded  to  houses  of 
similar  standing  in  this  country. 

If  a  permanent  business  is  to  be  developed  in  South  America,  terms 
of  from  60  to  1 50  days  should  be  accorded  to  responsible  firms.  The 
average  European  terms  accorded  before  the  war  were  1 80  days,  and, 
with  a  return  of  European  competition,  South  American  business  will 
naturally  gravitate  to  the  country  (merchandise  being  practically 
equal)  which  offers  the  best  facilities  for  payment.  South  American 
merchants  are  averse  to  making  changes  of  avenues  of  trade  once 
established.  This  was  the  sad  experience  of  former  American  travelers 
to  South  America.  The  war,  however,  disrupted  the  old  trade  routes, 
and  Europe  cannot  very  well  for  some  time  to  come  accord  the  long 
terms  of  the  pre-war  period,  although  reports  from  South  America 
indicate  that  representatives  of  English  houses  are  now  offering  terms 
of  from  four  to  six  months,  charging  interest,  however,  from  date  of 
invoice  at  the  rate  of  six  per  cent. 

As  this  country  should  be  better  able  to  accord  time,  the  period 
is  opportune  for  the  development  of  the  good  will  of  reliable  South 
American  houses  by  according  now  the  credit  extension  to  which  their 
credit  standing  would  indicate  they  are  entitled. 

It  must  be  remembered  that  the  South  American  merchant  is  some 

[12] 


INSTRUCTION  FROM  CLIENT 


thousands  of  miles  removed  from  his  sources  of  supply,  and  what- 
ever time  is  accorded  him  does  not  commence  until  after  the  arrival; 
in  fact,  until  after  the  release  from  the  customs  in  his  own  country 
of  the  merchandise  ordered,  as  at  times  it  takes  from  five  days  to 
two  or  three  weeks  to  effect  release.  It  should,  furthermore,  be  borne 
in  mind  that  where  the  draft  is  drawn  in  dollars,  a  request  for  an 
extension  of  a  few  days  or  weeks  in  payment  does  not  necessarily 
imply  that  the  foreign  firm  is  short  of  funds.  In  the  great  majority 
of  instances  this  simply  means  that  as  the  dollar  draft  must  be  met 
in  the  currency  of  the  country,  the  exchange  rate  at  the  date  of 
maturity  is  unfavorable  and  the  merchant  wishes  an  additional  period 
in  the  hope  that  exchange  in  the  interim  may  swing  back  to  a  figure 
which  will  enable  him  to  meet  the  draft  on  more  favorable  terms.  For 
this  extra  period  he  willingly  pays  interest.  South  American  merchants 
are  all  students  of  exchange,  as  they  are  constantly  meeting  drafts  in 
the  various  currencies  of  the  world. 

INSTRUCTION  FROM  CLIENT 

Packing,  Billing,  Shipment 

ADHERE  scrupulously  to  instructions  of  client  as  given  in  order. 
The  failure  to  observe  this  fundamental  rule  of  foreign  commerce  has 
shipwrecked  the  hopes  of  many  houses  aspiring  to  establish  foreign 
relations.  Note  particularly  the  instructions  regarding  packing  and 
shipping.  If  foreign  client  requests  that  certain  quantities  of  merchan- 
dise be  wrapped  in  paper  before  packing  in  case  for  shipment,  it  is  of 
importance  to  the  clients  interest  that  such  instructions  be  complied 
with. 

For  further  reference  to  this  important  topic,  note  remarks  herein 
under  "Packing." 

See  that  the  number  and  the  marks  and  measurements  of  boxes  and 
cases,  with  weights  in  kilos,  appear  on  invoices. 

If  a  request  be  made  by  the  foreign  customer  to  have  measure- 
ments of  boxes,  bales,  or  containers  appear  on  invoices  in  the  metric 
system,  considerable  inconvenience  and  perhaps  expense  may  be  saved 
for  him  by  compliance  with  this  request,  and  such  compliance  may 
likewise  insure  to  the  American  merchant  the  retention  of  his  foreign 
customer's  future  business  and  good  will.  The  most  frequently  used 

[13] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

of  the  metric  equivalents  of  our  weights  and  measurements  will  be 
found  herein  under  "Metric  Weights  and  Equivalents." 

If  three  or  four  invoices  and  a  similar  number  of  ladings  are  re- 
quested, see  that  this  number  is  furnished. 

We  should  assume  that  client  knows  what  his  needs  and  those  of 
his  trade  require.  Furthermore,  these  requirements  are  not  directly 
those  of  client,  but  of  the  customs  department  of  the  country  to 
which  the  shipment  is  made. 

Substitution  of  Merchandise 

A  CONSIDERABLE  element  of  risk  is  assumed  by  American 
manufacturers  or  exporters  in  substituting  one  class  of  merchandise 
for  another,  or  different  kinds,  colors,  or  weights  of  the  same  mer- 
chandise, without  the  express  consent  of  the  consignee. 

Where  such  substitutions  may,  in  the  opinion  of  shipper  be  neces- 
sary, it  is  advisable  before  making  shipment  to  secure  cable  authoriza- 
tion from  the  foreign  purchaser  for  so  doing. 

PACKING 

A  SUBJECT  calling  for  close  and  intelligent  study  in  foreign 
trade  is  the  packing  of  shipments.  On  the  kind  and  manner  of 
packing  depend  the  arrival  of  shipment  at  destination,  the  amount 
of  rail  and  ocean  freight  charged  for  transportation  and  the  amount  of 
customs  duties  imposed.  Duties  are  frequently  affected,  sometimes 
quite  seriously,  by  faulty  packing  or  by  the  use  of  a  container  or  a 
covering  which  brings  the  contents  under  a  classification  of  tariff 
higher  than  would  be  the  case  were  a  different  kind  or  method  of 
packing  used. 

Packing  should  be  considered  with  three  different  aspects  in  view: 
the  preservation  of  the  merchandise,  economy  in  duties  to  be  im- 
posed by  the  foreign  custom  house,  and  economy  in  the  space  occupied 
by  the  packed  shipment.  In  connection  with  this  subject  it  should  be 
remembered  that  in  addition  to  the  severe  and  varied  handlings  of 
shipments  incident  to  being  placed  aboard  vessel  in  this  country  they 
are  subjected  to  considerable  additional  handling  in  the  foreign  port, 
and  to  interior  points  in  many  of  the  South  American  countries  trans- 
portation from  the  coast  is  by  means  of  river  steamer,  raft  and  mule. 
Generally  speaking,  bulky  packages  should  be  avoided  when  this  is 

[  HI 


PACKING  SHIPMENTS  FOR  EXPORT 


possible,  it  being  far  better  to  divide  the  shipment  into  two  or  per- 
haps three  parts. 

Packing  should  be  as  light  as  possible,  consistent  however  with  the 
strength  necessary  to  carry  to  destination,  intact  and  in  proper  con- 
dition, the  particular  class  of  merchandise  shipped,  having  in  mind 
the  numerous  exceedingly  rough  handlings  and  many  changes  to 
which  all  foreign  shipments  are  subjected. 

If,  to  answer  this  purpose,  a  heavier  case  with  metal  straps  and 
bands  is  necessary  then  by  all  means  the  packing  should  be  done  in 
this  manner. 

When  a  foreign  buyer  suggests  that  his  order  be  packed  in  a  cer- 
tain way,  it  is  possible  that  his  request  is  based  upon  the  rules  of  the 
custom  house  regarding  the  imposition  of  duties.  As  an  illustration 
of  this  point,  shovels  when  imported  into  Chile  pay  no  duty  if  they 
come  into  the  country  complete.  If,  however,  the  handles  and  the 
metal  bases  come  packed  separately  duties  are  imposed  upon  each. 
It  is  evident  that  a  shipment  of  shovels  sent  forward  in  this  divided 
manner  will  entail  upon  the  part  of  foreign  purchaser  the  payment 
of  the  duties  imposed  resulting  in  dissatisfaction  and  complaint. 

When  merchandise  is  forwarded  to  a  distributing  agent,  goods  for 
different  consignees  should  not  be  placed  in  the  same  case  unless 
instructions  have  been  received  to  this  effect,  because,  when  so  packed, 
delivery  to  any  one  consignee  renders  necessary  the  payment  of  all 
duties  and  the  release  from  the  customs  of  the  entire  shipment. 

Where  various  packages  make  up  a  shipment  to  one  consignee,  it 
is  advisable  to  have  the  same  identifying  mark  appear  on  all.  Con- 
secutive numbers  should  be  used  to  distinguish  the  various  packages. 
To  illustrate: — If  a  shipment  is  prepared  for  Juan  Silveira  &  Com- 
pany, Buenos  Aires,  the  identifying  mark  would  probably  be: 

j.  s.  &  co. 

BAIRES 

If  there  were  two  bales  or  boxes,  they  would  be  marked: 
j.  s.  &  co.  j.  s.  &  co. 

BAIRES  BAIRES 

Number  i  Number  2 

and  these  marks  and  identifying  numbers  should  appear  on  the  Con- 
sular invoices,  the  bills  of  lading,  and  on  the  commercial  invoices, 

[15] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

With  the  contents  of  each,  and  with  the  net  and  gross  weights  in 
kilos  and  the  measurements  in  inches  or  in  the  metric  system. 

Note  under  "General  Remarks,"  on  page  in,  the  observations  on 
stenciling  of  packages. 

Packing  and  Import  Duties 

IN  CONNECTION  with  packing,  it  is  important  to  note  that 
upon  imports  into  most  South  American  countries  the  duty  is  levied 
on  the  gross  weight,  meaning  thereby  the  total  weight  less  rough 
wooden  or  other  container. 

When  container  is  of  a  nature  the  duty  on  which  may  be  higher 
than  that  of  its  contents,  separate  duties  are  levied  thereon. 

Merchandise  of  various  kinds,  if  packed  in  the  same  case  or  pack- 
age, runs  the  risk  of  being  assessed  at  the  rate  of  the  highest  taxed 
article  therein.  Furthermore,  if  the  description  of  the  goods  in  declara- 
tion is  such  as  to  render  doubtful  the  classification  under  which  the 
shipment  should  be  placed,  foreign  customs  authorities  always  classify 
under  the  highest  rating. 

In  practically  all  of  our  large  cities  it  will  be  found  that  consuls 
of  the  various  South  American  countries  have  offices  and,  before 
packing  shipments,  it  is  advisable  for  exporters  to  find  out  whether 
the  duties  to  be  imposed  in  the  South  American  country  of  destina- 
tion are  calculated  on  the  net,  legal,  or  gross  weight.  The  net  weight 
indicates  the  weight  of  the  article  itself,  exclusive  of  its  packing  or 
wrapping.  The  legal  weight  signifies  the  weight  of  the  article  plus  its 
immediate  covering.  For  example,  on  merchandise  packed  in  card- 
board boxes  with  perhaps  a  half  gross  or  more  of  these  boxes  in  a 
case,  the  legal  weight  is  the  weight  of  the  merchandise  plus  the  card- 
board container,  but  not  the  weight  of  the  outside  wooden  case. 
Gross  weight  means  the  total  weight  of  the  merchandise  including 
the  outside  container. 

A  recent  shipment  of  neckwear  to  Chile  was  refused  by  the  con- 
signee on  the  ground  that  the  ties  came  packed  in  fancy  cardboard 
boxes,  one  tie  to  a  box,  the  container  weighing  three  times  as  much 
as  the  tie  itself.  The  duties  in  this  instance  were  imposed  by  "legal 
weight,"  and  had  the  merchant  accepted  shipment  it  will  be  seen 
that  for  each  tie  he  would  have  been  taxed  four  times,  viz. :  the  duty 
on  the  tie,  plus  the  duty  at  the  same  rate  on  the  cardboard  box, 
figured  on  its  weight. 

[16] 


FINANCING  FOREIGN  SHIPMENTS 


Labels  on  Merchandise 

LABELS  on  the  merchandise  itself  should  be  in  Portuguese  on 
shipments  to  Brazil,  and  in  Spanish  on  shipments  to  other  South 
American  countries.  This  is  an  important  detail  to  keep  in  mind,  as 
labels  in  English  mean  little  or  nothing  to  the  general  public  in  South 
America. 

These  observations  should  be  sufficient  to  indicate  the  necessity 
for  the  exercise  of  extreme  care,  if  the  interests  of  foreign  clients  are 
to  be  protected. 

Our  Foreign  Trade  Department  is  at  the  service  of  our  clients  for 
any  further  information  that  may  be  required  on  this  important 
subject. 

FINANCING 

A>J  explanation  of  the  various  methods  of  financing  foreign  ship- 
ments will  be  of  interest  to  those  not  familiar  with  this  pro- 
cedure. Of  these  methods,  the  following  may  be  mentioned: 

The  Open  Account 

THIS  is  the  same  in  dealing  with  foreign  clients  as  it  is  be- 
tween American  clients.  Under  the  open  account,  the  documents  are 
forwarded  direct  to  foreign  customer  without  the  formality  of  a  draft 
acceptance  at  the  time  the  documents  are  delivered,  payment  to  be 
made  later  on  under  the  conditions  existing  between  the  parties  to 
the  transaction. 

Many  of  the  larger  South  American  houses  will  transact  business 
only  upon  an  open  account  basis,  and  some  European  exporters  are 
acquiescing  in  this  exaction.  This,  of  course,  is  possible  only  with 
houses  in  first-class  credit  standing. 

Commercial  Credits 

IMPORTING  under  commercial  credits  is  not  popular  with 
South  American  merchants.  This  exaction  on  the  part  of  American 
exporters  was  possible  during  the  war  period,  but  a  permanent  foreign 
trade  cannot  be  developed  if  this  method  of  financing  our  exports 
is  to  be  persisted  in. 

Representatives  of  American  houses  in  making  arrangements  with 
foreign  clients  for  the  opening  of  commercial  credits  frequently 

[17] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

promise  that  payment  thereunder  by  purchaser  is  to  be  against 
arrival  at  destination  of  the  shipping  documents. 

In  this  connection  it  should  be  remembered  that  where  a  foreign 
merchant  opens  a  commercial  credit  through  a  bank,  under  which 
payment  is  to  be  made  in  this  country  against  shipping  documents, 
the  manner  of  reimbursement  to  the  foreign  bank  opening  such  credit 
rests  with  bank  and  not  with  the  representative  of  the  American 
exporter. 

A  recognition  of  this  principle  in  connection  with  foreign  com- 
mercial credits  will  eliminate  considerable  dissatisfaction  between  the 
various  parties  to  the  transaction. 

Foreign  buyers  usually  refuse  to  open  credits  for  payment  in  this 
country  against  railroad  bill  of  lading,  insisting  that  payment  be 
made  only  against  delivery  to  the  bank  of  ocean  documents. 

See  reference  herein  to  "Selling  Terms  on  Foreign  Orders,"  also 
"Credit  Information." 

Unconfirmed  or  Revocable 
Confirmed  or  Irrevocable 

COMMERCIAL  CREDITS  are  either  UNCONFIRMED  or  CONFIRMED, 
and,  as  with  Drafts,  may  be  either  CLEAN  or  DOCUMENTARY,  and 
serve  as  a  method  of  financing  foreign  shipments.  The  Unconfirmed 
or  Revocable  Credit  is  one  opened  by  a  merchant  through  a  bank  in 
one  country  to  be  utilized  by  transfer  through  a  bank  in  another 
country.  The  beneficiary  thereunder  is  generally  the  merchant  from 
whom  purchase  has  been  made. 

An  Unconfirmed  or  Revocable  Credit  is  subject  to  revocation  at 
any  time  by  any  of  the  interested  parties,  and  on  this  account  is  not 
as  acceptable  to  the  beneficiary  thereunder  as  is  the  Confirmed  or 
Irrevocable  Credit,  particularly  on  merchandise  manufactured  to 
order.  A  Confirmed  or  Irrevocable  Credit  cannot  be  cancelled  during 
its  life  unless  with  the  consent  of  the  four  parties  thereto;  the  applicant 
for  the  credit,  his  banker,  the  issuing  bank  and  the  beneficiary.  The 
rate  of  commission  charged  by  a  bank  on  a  Confirmed  Credit  is 
slightly  higher  than  that  charged  on  an  Unconfirmed  Credit. 

The  conditions  of  the  Credit  indicate  whether  it  is  Clean  or  Docu- 
mentary. 


[  18] 


THE  VARIOUS  KINDS  OF  CREDITS 


Clean  Credit 

A  CLEAN  CREDIT  is  one  under  which  payment  to  the  bene- 
ficiary is  made  simply  against  receipt  or  against  a  clean  draft  (i.e., 
draft  without  documents  attached). 

Documentary  Credit 

A  DOCUMENTARY  CREDIT  requires  that  payment  be  made  by 
the  bank  against  delivery  to  it  of  a  full  set  of  documents,  or  such 
documents  as  may  be  called  for  under  the  conditions  of  Credit. 

As  to  what  constitutes  a  complete  set  of  documents,  see  "Docu- 
ments" in  index. 

Acceptance  Credit 

THERE  is  also  what  is  termed  an  ACCEPTANCE  CREDIT,  the 
drafts  under  which,  when  drawn  by  the  beneficiary  up  to  six  months 
sight,  exclusive  of  days  of  grace,  are  "accepted"  by  a  bank,  for  pay- 
ment at  maturity. 

Such  drafts,  when  accepted  by  a  member  bank  of  the  Federal 
Reserve  System  are  eligible  for  discount  in  the  open  market  or  for 
rediscount  with  a  Federal  Reserve  Bank  at  best  rates,  in  accordance 
with  the  Federal  Reserve  Board's  rulings  on  such  acceptances. 

To  establish  credits  of  this  nature  it  is  necessary  that  the  purchaser 
in  a  foreign  country  deposit  with  his  local  bank  the  equivalent  of  the 
required  amount  as  collateral,  or  arrange  with  the  bank  for  accom- 
modation to  provide  for  the  amount  involved. 

The  operation  of  these  Commercial  Credits,  when  made  available 
in  this  country,  is  as  follows: 

Our  branch  or  correspondent  in  foreign  country  through  which  the 
credit  has  been  created,  informs  us  of  the  opening  of  Credit,  and  we 
in  turn  inform  the  beneficiary  that  the  Credit  has  been  established 
in  his  favor,  and  also  the  amount  and  the  conditions  under  which 
we  shall  make  payments  or  accept  drafts  drawn  thereunder. 

Many  large  purchases  are  effected  through  this  medium,  the  credits 
being  arranged  not  only  by  South  American  firms  in  favor  of  firms 
in  the  United  States,  but  also  by  American  firms  in  favor  of  South 
American  and  European  houses. 

Where  the  foreign  merchant  does  not  open  a  Commercial  Credit 
to  cover  his  merchandise  purchases  in  this  country,  payment  is  usu- 
ally effected  through  the  medium  of  a  draft  which  is  forwarded  for 

[19] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

collection,  either  with  or  without  the  shipping  and  other  documents, 
to  our  foreign  branches  or  correspondent  bank. 

Revolving  Credit 

WHERE  the  operations  between  two  parties  in  different  coun- 
tries are  to  be  more  or  less  continuous,  a  convenient  and  economical 
form,  known  as  a  revolving  credit,  may  be  established. 

Under  this  form  of  credit,  once  the  conditions  are  agreed  upon, 
they  may  be  made  permanent  for  future  credits  by  simply  embody- 
ing the  conditions  under  which  the  amounts  may  again  become  avail- 
able. Through  the  medium  of  a  credit  of  this  nature,  as  the  amounts 
drawn  thereunder  are  liquidated,  they  again  become  available  under 
the  conditions  of  the  original  credit  without  the  necessity  of  further 
cabling  or  correspondence. 

Revolving  credits  may  be  divided  into  three  forms.  To  illustrate: 


A  in  foreign  country  opens  a  credit  in  favor  of  B  in  this  country 
"up  to  say  $20,000,"  the  conditions  of  which  permit  B  to  draw,  as 
shipments  are  effected,  upon  the  bank  through  which  the  credit  is 
made  available,  the  said  bank  honoring  such  drafts  when  accompanied 
by  documents  covering  a  specific  shipment.  Upon  liquidation  by  A  of 
the  amount  drawn  by  B,  such  amount  again  becomes  available  to 
be  drawn  against  by  B  under  the  original  conditions.  Should  the  total 
amount  of  the  credit  become  exhausted,  no  further  drawings  there- 
under may  be  made  by  B  until  liquidation  by  A  of  all  or  of  a  portion 
of  the  drafts  by  B.  This  explains  the  revolving  feature  of  this  credit, 
inasmuch  as  the  full  credit,  or  such  portions  thereof  as  have  been 
liquidated  by  A,  automatically  become  available  again  to  be  drawn 
against  by  B. 

II 

The  second  class  of  credit  under  this  revolving  form  permits  B, 
upon  A's  instructions  to  the  bank,  to  draw  a  specified  sum  in  one 
draft.  Upon  maturity  and  payment  of  this  draft  by  A,  the  same 
amount  again  becomes  available  to  be  drawn  against  by  B  upon  the 
same  conditions  which  governed  the  original  drawing. 

[20] 


COMMERCIAL  CREDITS 


III 

Under  the  third  class  of  revolving  credit,  A  in  the  foreign  country 
permits  B  in  this  country  to  draw  in  one  draft  for  the  full  amount 
involved,  whereupon  the  credit  again  becomes  automatically  avail- 
able for  a  similar  amount  and  so  on  indefinitely  until  the  expiration 
of  the  time  limit  specified  in  the  original  instructions. 

This  last  form  of  credit  is  limited  as  to  time;  but,  as  to  the  amounts 
drawn  thereunder,  it  is  only  limited  to  the  units  in  which  the  drafts 
may  be  drawn,  no  limit  being  set  as  to  the  maximum  amount  which 
may  be  drawn  thereunder. 

It  is  also  possible  to  limit  drawings  to  a  certain  amount  during 
a  specified  period,  to  be  drawn  in  one  or  5  n  various  drafts,  the  original 
amount  again  becoming  available  at  the  expiration  of  each  of  such 
periods. 

The  revolving  credit  is  very  elastic  in  its  application,  and  may  be 
made  to  serve  any  reasonable  requirements  along  the  lines  suggested. 

Furthermore,  it  should  be  noted  that  the  commission  charged  by 
the  bank  is  calculated  not  upon  the  full  amount  for  which  credit  is 
originally  opened,  but  upon  the  amount  or  amounts  as  availed  of 
thereunder. 


HOW  COMMERCIAL  CREDITS  ARE  OPENED 

ILLUSTRATION    OF    A    COMPLETE    TRANSACTION    FROM    THE 

OPENING  OF  THE  CREDIT  TO  THE  FINAL  PAYMENT 

TO  BE  MADE  THEREUNDER 

A  MERCHANT  in  the  Argentine,  let  us  say,  has  ordered  a  quan- 
tity of  machinery  from  a  Chicago  house.  As  the  Chicago  house 
is  not  familiar  with  the  credit  standing  of  the  Buenos  Aires  firm,  let 
us  suppose  that  the  information  in  our  credit  files  is  not,  in  this  in- 
stance, of  a  nature  to  warrant  the  extension  of  time.  The  Chicago 
house  thereupon  cables  the  Argentine  merchant  that  the  order  will 
be  entered  if  a  confirmed  commercial  credit  is  opened  in  their  favor 
through  The  National  City  Bank  of  New  York. 

A  confirmed  credit  is  required  in  this  instance,  as  the  machinery 
may  be  of  special  manufacture,  and  the  Chicago  house,  before  com- 
mencing work  upon  it,  wishes  to  be  secured  against  a  possible  revoca- 
tion of  the  order  when  perhaps  the  machinery  is  half  completed. 

[21] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

The  Buenos  Aires  merchant,  acquiescing  in  the  demand  of  the 
Chicago  house,  arranges  with  the  Buenos  Aires  branch  of  The  National 
City  Bank  of  New  York  for  the  opening  of,  say  a  $20,000  confirmed 
credit,  to  be  availed  of  through  the  main  office  of  the  bank  in  New 
York. 

The  Chicago  house  is  made  the  beneficiary  under  this  credit,  which 
is  practically  an  order  on  the  New  York  office  of  the  bank,  either  by 
cable  or  letter,  to  pay  to  the  Chicago  house  the  amount  stipulated, 
generally  upon  delivery  to  the  bank  of  a  full  set  of  shipping  docu- 
ments covering  the  shipment.  If  the  credit  were  an  "acceptance 
credit,"  the  New  York  office  of  the  bank  would  "accept"  the  draft 
of  the  Chicago  house  for,  say  thirty,  sixty  or  ninety  days,  as  may 
have  been  agreed  upon.  Further  particulars  as  to  "acceptance  credits'* 
are  given  on  page  19. 

Upon  receipt  at  New  York  of  either  the  cable  or  letter  opening  the 
credit,  the  bank  at  New  York  immediately  notifies  the  beneficiary 
(the  Chicago  house  in  this  instance),  that  such  credit  has  been  opened 
and  the  conditions  upon  which  payments  thereunder  will  be  made. 
It  will  be  noted  upon  reference  to  the  definition  of  a  "confirmed 
credit"  that  this  kind  of  credit  can  be  revoked  only  with  the  consent 
of  the  four  parties  concerned,  viz. :  the  Buenos  Aires  merchant,  the 
Buenos  Aires  branch  of  The  National  City  Bank  of  New  York,  the 
New  York  office  of  The  National  City  Bank  of  New  York,  and  the 
beneficiary  at  Chicago. 

The  machinery  having  been  completed,  the  Chicago  house  consigns 
it  on  railroad  bill  of  lading  to  its  New  York  agent,  or,  in  the  absence 
of  a  New  York  agent,  then  to  some  reputable  forwarding  house  at 
New  York,  the  shipping  port,  with  instructions  to  secure  the  ocean 
bills  of  lading,  the  Consular  invoice,  insurance  certificates,  and  other 
necessary  documents.  These  documents  are  thereupon  presented  to 
the  bank,  and  if  they  are  in  order  and  meet  the  requirements  of  the 
credit,  payment  will  be  made  by  the  bank,  usually  through  the 
medium  of  a  bank  check  to  the  order  of  the  beneficiary.  If,  however, 
beneficiary  is  a  depositor  of  the  bank,  it  is  probable  that  the  amount 
will  simply  be  credited  to  his  account. 

The  Bills  of  Lading  are  generally  made  out  "To  Order"  and  are 
endorsed  in  blank  by  shipper,  after  which  they  are  forwarded  to  our 
Buenos  Aires  branch.  "To  Order"  Bills  of  Lading,  however,  are  not 
permissible  to  Venezuela  and  Colombia,  to  which  countries  it  is  neces- 

[22] 


COMMERCIAL  CREDITS 


sary  to  consign  documents  and  merchandise  direct  to  consignee.  More 
care  is  therefore  necessary  in  looking  into  the  credit  standing  of  con- 
signees in  those  countries. 

It  will  be  noted  in  the  transaction  we  are  following  that  as  the 
bills  of  lading  have  been  made  out  "To  Order"  and  endorsed  in  blank, 
the  bank,  having  possession  of  the  documents,  practically  controls 
the  shipment,  and  the  Buenos  Aires  branch  will  surrender  these  evi- 
dences of  title,  which  we  shall  assume  have  gone  along  on  the  same 
steamer  carrying  the  shipment,  only  upon  compliance  by  the  pur- 
chaser in  the  Argentine  with  whatever  conditions  were  agreed  upon 
in  the  undertaking  creating  the  credit. 

These  conditions  may  take  various  forms.  If  the  credit  standing 
of  the  Argentine  merchant  is  beyond  question,  it  is  possible  that  he 
has  established  with  our  branch  a  line  of  credit  to  cover  his  com- 
mercial credit  operations,  in  which  event  the  documents  may  be  sur- 
rendered to  him  without  collateral  security  being  placed  with  our 
branch  bank. 

Should  security  be  deemed  advisable,  this  may  take  various  forms, 
such  as  depositing  with  the  branch  acceptable  securities  (bonds  or 
stocks)  until  liquidation  of  the  obligation,  or  perhaps  the  depositing 
of  a  note  bearing  the  endorsement  of  a  responsible  individual  or  firm. 
It  may  have  been  agreed  that  such  surrender  is  to  be  made  upon 
acceptance  by  the  Argentine  merchant  of  a  draft  to  be  drawn  upon 
him  for  an  agreed  tenor  by  our  Buenos  Aires  branch.  It  may  also  take 
the  form  of  a  trust  receipt  to  be  delivered  to  the  branch  by  the 
Argentine  merchant,  under  which  title  to  the  merchandise  remains  in 
the  name  of  the  bank,  the  proceeds  or  part  thereof,  of  partial  sales 
to  be  turned  over  by  the  merchant  to  the  branch  until  complete 
liquidation  of  the  transaction.  There  is  usually  more  form  than  sub- 
stance to  a  trust  receipt,  however,  as  once  the  merchandise  has  been 
placed  in  the  warehouse  of  the  purchaser  it  is  not  an  easy  matter, 
in  fact  it  is  practically  impossible  in  most  instances,  to  have  it  so 
marked  as  to  keep  it  safely  segregated  from  other  merchandise  for 
identification  in  the  event  of  default  or  other  impediment  arising. 

It  is  possible  that  the  conditions  of  the  credit,  owing  to  the  financial 
and  credit  standing  of  the  Argentine  merchant,  may  be  broad  enough 
to  permit  of  the  documents  being  forwarded  direct  to  the  Argentine 
merchant  by  the  shipper  in  the  States,  in  which  case  such  documents 
should  be  made  out  to  his  order  direct. 

[23] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

In  the  case  of  an  "acceptance  credit,"  the  draft  drawn  upon  the 
bank  by  the  beneficiary  (in  this  instance  the  merchant  in  Chicago), 
will  be  accepted  by  the  main  office  of  the  bank  in  New  York,  under 
the  Federal  Reserve  Act  which  grants  to  national  banks  the  privilege 
of  accepting  bills  of  exchange  growing  out  of  transactions  involving 
the  importation  and  exportation  of  goods.  This  acceptance  usually 
takes  the  form  of  a  stamp  across  the  face  of  the  draft,  with  the  word 
"accepted"  and  the  date,  with  the  signature  of  a  duly  authorized 
officer  of  the  accepting  bank,  and  will  thereupon  be  detached  from 
the  other  documents  for  return  to  the  Chicago  firm,  to  be  discounted 
by  them  immediately,  if  they  prefer,  or  to  be  held  by  them  until 
the  maturity  date  thereof. 

In  the  case  of  the  "acceptance  credit,"  the  conditions  at  Buenos 
Aires  under  which  the  credit  was  originally  opened  quite  likely  specify 
that  payment  is  to  be  made  some  days  prior  to  the  actual  maturity 
date  of  acceptance  at  New  York,  through  the  medium  of  a  draft  to 
be  drawn  by  our  Buenos  Aires  branch  upon  the  Argentine  importer. 
This  draft  is  given  an  earlier. maturity  date  than  the  Chicago  draft, 
in  order  to  enable  the  Buenos  Aires  branch  of  the  bank  to  cable  the 
funds  to  New  York  in  time  for  the  New  York  office  to  meet  its 
"acceptance"  of  the  draft  of  the  Chicago  house. 

One  of  the  points  of  difference  between  the  ordinary  confirmed 
documentary  credit  and  the  "acceptance  credit"  is  that  under  the 
former  it  is  not  always  necessary  for  the  American  shipper  to  draw 
drafts,  the  conditions  of  the  credit  usually  instructing  the  bank  to 
pay  cash  against  receipt  of  documents,  the  bank  taking  simply  the 
receipt  of  the  shipper  for  payments  made  thereunder.  This  receipt 
may  consist  of  the  simple  endorsement  of  beneficiary  on  the  bank's 
check  for  the  amount  involved.  Under  the  "acceptance  credit,"  how- 
ever, the  instructions  from  the  bank  through  which  the  credit  was 
originally  opened  to  the  bank  through  which  it  is  to  be  made  avail- 
able, would  be  to  "accept"  the  draft  of  the  American  shipper,  under 
certain  specified  conditions,  such  acceptance  by  the  bank  protecting 
the  maker  of  draft  in  the  event  of  the  Argentine  merchant  becoming 
insolvent  before  maturity  date.  The  recourse  of  the  New  York  bank 
under  such  a  contingency  would  be  to  the  foreign  bank  which  origin- 
ally opened  the  credit  and  upon  the  instructions  of  which  acceptance 
was  made. 

While  the  illustration  we  have  given  covers  an  export  transaction, 

[24] 


COMMERCIAL  CREDITS 


the  operation  for  an  import  transaction  is  the  same  with  simply  a 
reversal  of  the  various  incidental  steps. 

If,  for  example,  a  Chicago  merchant  is  importing  wool  from  the 
Argentine,  he  would  open  through  this  bank  the  kind  of  credit  de- 
sired. This  credit  would  be  forwarded  direct  to  our  branch  bank  in 
Buenos  Aires  either  by  mail  or  cable,  as  instructed  by  the  Chicago 
house,  and  upon  arrival  at  New  York  of  the  corresponding  wool 
shipment,  the  agent  of  the  Chicago  merchant  at  this  port,  or  his 
forwarding  agent,  would  attend  to  the  Custom  House  clearance  and 
other  requirements,  and  upon  its  release  would  make  railroad  ship- 
ment to  final  destination  at  Chicago. 

To  this  point  we  have  been  treating  of  a  foreign  shipment  under 
the  terms  of  a  confirmed  commercial  credit  and  also  under  the  "ac- 
ceptance credit."  Confirmed  acceptance  credits,  like  confirmed  com- 
mercial credits,  are  irrevocable.  It  is  possible,  however,  to  open  an 
unconfirmed  commercial  credit.  This  class  of  commercial  credit  is 
subject  to  revocation  at  the  will  of  any  of  the  parties  thereto  and 
on  this  account  is  not  as  acceptable  to  American  merchants  as  is 
the  confirmed  credit,  particularly  where  the  merchandise  ordered 
thereunder  is  to  be  manufactured. 

But  now  let  us  consider  the  shipment  from  Chicago  in  the  case 
under  illustration  as  one  for  which  a  commercial  credit  had  not  been 
opened,  the  conditions  of  the  order  as  placed  stating  that  draft  is 
to  be  drawn  by  shipper  on  the  Argentine  buyer  either  at  sight,  or 
say  at  sixty,  or  ninety  days'  sight. 

As  in  the  case  of  the  "acceptance"  or  confirmed  credit,  upon  com- 
pletion of  the  machinery  and  its  shipment  to  New  York,  the  forward- 
ing agent  in  the  latter  city,  acting  under  instructions  from  the  Chicago 
shipper,  will  have  secured  the  necessary  shipping  and  other  docu- 
ments. Draft  made  payable  to  The  National  City  Bank  of  New  York 
covering  the  invoice  value  of  the  shipment,  plus  charges  to  be  in- 
cluded, having  likewise  been  forwarded  to  the  New  York  agent, 
will  be  presented  by  him  with  the  complete  set  of  documents  to  the 
New  York  office  of  The  National  City  Bank. 

It  is  possible  that  the  Chicago  merchant  has  had  a  line  of  credit 
established  with  this  bank  for  the  discount  of  his  foreign  drafts,  in 
which  event,  if  the  draft  is  discounted,  the  account  of  the  Chicago 
house  with  the  bank  will  now  be  credited  with  the  proceeds,  or,  if 
we  are  so  instructed,  with  its  full  face  value.  This  latter,  however, 

[251 


Rio  de  Janeiro  Branch 
The  National  City  Bank  of  New  York 


[26] 


DRAFTS 


is  advisable  only  where  an  understanding  has  previously  been  entered 
into  between  the  shipper  and  foreign  client,  whereby  the  latter  under- 
stands that  he  is  to  pay  the  interest  and  charges  involved  in  this 
procedure  (see  reference  herein  under  discounting  drafts). 

Whether  draft  is  for  collection  or  discount,  it  will  be  forwarded 
with  the  complete  set  of  documents  to  our  Buenos  Aires  branch  for 
collection.  Upon  arrival  of  the  documents  at  Buenos  Aires,  our  branch 
there  will  immediately  advise  the  Buenos  Aires  merchant.  The  docu- 
ments in  this  case,  as  in  the  case  of  the  "acceptance  credit,"  are  quite 
probably  "To  Order"  and  will  be  surrendered  to  the  foreign  client 
only  upon  compliance  by  him  with  whatever  instructions  we  have 
received  in  this  respect  from  the  Chicago  shipper.  If  the  draft  be 
a  sight  draft,  documents  will  be  surrendered  upon  payment.  If,  how- 
ever, it  be  a  time  draft,  the  custom  in  South  American  countries  is 
to  surrender  documents  upon  "acceptance"  of  the  draft  by  foreign 
client.  In  the  case  of  a  sight  draft,  drawn  in  dollars,  the  New  York 
funds  paid  against  the  surrender  of  documents  will  be  immediately 
forwarded  to  our  New  York  office,  where,  if  the  draft  was  not  origin- 
ally discounted  for  the  Chicago  firm,  the  proceeds  will  be  placed  to 
the  credit  of  their  account.  If,  however,  draft  is  a  time  draft,  the 
accepted  draft  (with  acceptance  by  the  Buenos  Aires  merchant)  will 
be  held  at  our  Argentine  branch  until  maturity,  at  which  time,  upon 
payment  being  effected,  remittance  will  be  made  to  New  York  by 
the  Buenos  Aires  branch  as  in  the  case  of  the  sight  draft. 

DRAFTS 

DRAFTS  ARE   OF  VARIOUS    KINDS,  SIGHT  AND  TIME, 
CLEAN  AND   DOCUMENTARY 

Sight  Drafts 

A  SIGHT  OR  DEMAND  DRAFT,  as  its  name  implies,  is  one  pay- 
able at  sight,  or  upon  presentation  to  drawee.  Its  presentation  is 
made  by  the  foreign  bank  or  branch  through  which  collection  is  to 
be  made. 

While  a  sight  draft  should  be  paid  immediately  upon  presentation, 
"Sight"  in  many  countries,  in  accordance  with  custom,  has  come  to 
mean  the  date  of  arrival  of  shipment  at  the  foreign  custom  house, 
and  as  the  mails  may  carry  a  sight  draft  to  destination  a  week  or 
two  before  the  arrival  of  the  slower  freighter  carrying  the  shipment, 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

i>anks  in  the  countries  in  which  this  custom  prevails  have  no  alterna- 
tive but  to  await  the  arrival  of  shipment  before  insisting  upon  pay- 
ment of  a  sight  draft  or  the  acceptance  of  a  time  draft. 

The  objection  to  drafts  drawn  at  say  60  or  90  days  after  sight 
is  that  an  American  house  cannot  have  a  fixed  maturity  date  for 
such  drafts  until  after  advice  from  the  foreign  bank  of  actual  accept- 
ance of  the  item.  To  obviate  this  uncertainty,  some  merchants  extend 
drafts  on  South  America  at  say  120  days  date  instead  of  90  days 
sight.  South  American  merchants,  however,  prefer  the  sight  terms, 
as  the  time  thereunder  does  not  commence  to  run  until  actual  "ac- 
ceptance." 

Time  Drafts 

A  TIME  DRAFT  is  one  payable  at  some  stated  period  after 
presentation  or  at  a  fixed  future  time,  the  usance  differing  in  various 
lines  of  business,  but  rarely  running  beyond  1 50  days  sight. 

Usance  or  Tenory  Sight  and  Time 

THE  USANCE  OF  DRAFTS  is  either  so  many  days  after  "sight" 
or  after  "date."  "Sight"  in  this  case  means  that  the  tenor  or  time 
commences  to  run  from  the  date  of  presentation  for  acceptance, 
whereas  "Date"  usance  signifies  that  time  commences  to  run  from 
the  date  of  draft. 

Drafts,  Clean  and  Documentary 

CLEAN  DRAFTS  are  those  presented  to  a  bank  for  collection 
or  discount  without  bills  of  lading  and  other  documents  covering 
shipment. 

Documentary  Drafts  are  those  accompanied  by  the  bills  of  lading 
and  other  documents  evidencing  shipment. 

Discounting  Drafts 

To  DISCOUNT  drafts  drawn  upon  foreign  clients  necessitates 
the  establishing  of  a  credit  relation  between  the  American  merchant 
and  the  discounting  bank.  This  is  the  usual  means  whereby  concerns 
finance  foreign  shipments,  as  otherwise  the  funds  involved  would  be 
tied  up  until  collection  in  foreign  country  and  remittance  to  the 
United  States  has  been  effected. 

Drafts  on  foreign  clients  are  discounted  usually  with  recourse  to 

[28] 


DRAFTS 

the  maker.  By  this  is  meant  that  in  the  event  of  draft  not  being  met 
at  maturity  by  foreign  drawee,  the  discounting  bank  in  this  country 
reserves  the  right  to  charge  drawer  with  the  amount  originally  ad- 
vanced, plus  interest  for  the  intervening  time  and  any  other  charges 
which  the  item  may  have  incurred. 

Drafts  in  Cover  for  Parcel  Post  Shipments 

NOTE  reference  hereto  under  "Parcel  Post."  See  index. 

Dollar  Drafts 

DRAFTS  drawn  in  United  States  currency  should  bear  the 

clause  "Payable  at  banks  drawing  rate  on  day  of  payment  for  c * 

drafts  on  New  York." 

Rebating  Drafts 

OUR  South  American  branches  conform  to  the  generally  ac- 
cepted custom  of  allowing  6%  for  pre-payment  of  time  drafts,  unless 
specifically  instructed  to  the  contrary. 

Rates  for  Discounting  Drafts 

A  FLAT  RATE  of  from  ij^%  to  5!^%  is  charged  for  discount- 
ing drafts  on  South  America,  depending  upon  the  tenor  of  draft  and 
the  time  and  distance  from  New  York  to  the  country  upon  which 
the  item  is  drawn.  These  rates  are  made  up  in  this  manner  for  general 
convenience  in  calculating,  and  are  arrived  at  by  charging  interest 
for  the  estimated  time  elapsing  between  payment  of  funds  by  the 
discounting  bank  and  date  of  reimbursement  in  New  York.  To  illus- 
trate: if  draft  be  drawn  at  90  days  sight  on  Buenos  Aires,  an  addi- 
tional two  months'  interest  is  added  to  the  90  days  to  cover  the 
estimated  time  in  transit  to  and  from  that  point.  The  bank  reserves 
the  right  to  adjust  the  interest  charge  with  drawer  of  draft  should 
the  elapsed  time  be  longer  than  the  time  estimated. 

To  some  countries  there  is  also  added  the  foreign  bank's  collecting 
charge  for  drafts,  plus  foreign  revenue  stamp  tax  on  bills  of  exchange. 
These  charges  range  from  1/20  to  1/5  of  one  per  cent. 

Drafts  covering  export  shipments  from  this  country  are  not  sub- 
ject to  a  United  States  revenue  tax. 


[29] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Negotiability  of  Drafts 

To  RENDER  a  draft  negotiable,  the  time  of  payment  or  matur- 
ity must  be  definite.  It  must  be  drawn  for  an  amount  certain  either 
"at  sight,"  meaning  upon  presentation,  or  at  a  specified  number  of 
days  or  months  "after  date"  or  "after  sight,"  or  it  may  be  payable 
at  a  fixed  date. 

If  terms  are  indefinite,  such  as  "twenty  days  after  arrival  of  ship- 
ment," the  uncertainty  as  to  the  arrival,  rendering  the  date  of  pay- 
ment indefinite,  would  probably  vitiate  the  negotiability  of  drafts 
so  worded.  However,  if  this  wording  be  desired,  the  foreign  bank 
might  be  instructed  to  hold  the  draft  for  presentation  for  acceptance 
after  actual  arrival  of  shipment,  as  a  fixed  maturity  date  could  then 
be  set. 

Acceptance  of  Drafts 

THE  ACCEPTANCE  of  a  draft  is  the  written  acquiescence  on  the 
part  of  the  drawee  (the  one  upon  whom  it  is  drawn)  to  meet  pay- 
ment at  the  maturity  date  specified  therein  and  takes  the  form  of 
writing  across  the  face  of  draft  the  word  "accepted,"  with  the  date 
of  acceptance  and  the  signature  of  acceptor. 

A  draft  when  "accepted"  becomes  the  obligation  of  the  acceptor, 
embodying  his  agreement  to  pay  the  amount  thereof  at  the  time  and 
place  specified  in  the  body  of  the  instrument. 

While  we  are  naturally  glad  to  carry  with  us  one  of  the  banking 
accounts  of  firms  availing  themselves  of  our  discount  and  South 
American  collection  services,  it  is  not  necessary  that  an  account  be 
actually  placed  with  us  in  order  that  a  firm  interested  in  foreign 
trade  may  avail  itself  of  the  important  services  in  this  respect  which 
our  branches  throughout  South  America  enable  us  to  offer. 

Collection  of  Drafts 

FOREIGN  DRAFTS  are  also  received  by  banks  on  a  collection 
basis,  which  means  that  draft,  with  or  without  documents,  may  be 
deposited  with  a  bank  having  foreign  branches  or  correspondents, 
for  presentation  and  collection  in  foreign  country,  and  remittance 
of  proceeds  after  payment  has  been  effected. 

Rates  for  Collection 

FOR  THIS  SERVICE  the  bank  charges  a  small  commission.  Rates 

[30] 


DRAFTS 

will  be  furnished  upon  application,  as  they  differ  for  each  country 
and  for  different  cities  in  the  same  country. 

Payment  of  Drafts 

PAYMENT  FOR  DRAFTS  received  on  a  collection  basis  is  made 
to  drawer  (American  firm)  upon  receipt  by  us  of  remittance  from 
the  foreign  branch  or  correspondent  bank  through  which  collection 
is  made.  Such  remittances  may  be  made  to  us  by  cable,  if  American 
firm  so  instructs  when  placing  draft  with  us  for  collection. 

Privilege  of  Examination  of  Merchandise  in  South  America 
Before  Payment  or  Acceptance  of  Draft 

IN  SOME  South  American  countries,  notably  Brazil,  it  is  cus- 
tomary to  permit  examination  of  goods  before  payment  of  a  sight 
draft,  or  the  acceptance  of  a  time  draft.  In  countries  where  such 
custom  is  in  vogue,  our  branch  bank  will  allow  such  examination 
unless  express  instructions  to  the  contrary  are  received  from  drawer 
or  his  agent. 

In  Brazil,  drawee  is  usually  assessed  an  additional  5%  on  the 
duties  imposed,  for  the  privilege  extended  by  the  custom  authorities 
in  permitting  such  examination  before  actual  release  of  the  shipment. 

Instructions  Accompanying  Drafts    , 

WHEN  depositing  drafts  for  collection,  in  the  event  of  it  being 
desired  to  add  collection  charges,  interest  and  exchange,  as  well  as 
any  other  charges,  the  bank  should  be  so  instructed.  Difficulty  is 
generally  experienced,  however,  in  the  collection  of  drafts  accom- 
panied by  such  instructions  as  "Interest  at  6%  from  date  of  draft 
until  arrival  of  funds  in  New  York"  and  "All  expenses  for  account 
of  drawee."  Collection  would  be  greatly  facilitated  and  the  good  will 
of  foreign  client  retained  if  American  exporters,  instead  of  itemizing 
all  small  extra  charges  in  addition  to  the  cost  of  the  merchandise 
itself,  would  advance  the  quoted  price  a  point  or  two  to  cover  just 
such  items,  rendering  invoice  clean  and  without  any  extra  charges. 
American  merchants  demand  that  everything  be  itemized.  South 
American  merchants,  on  the  other  hand,  resent  this  detail,  and  on 
this  account  it  is  advisable  to  follow  the  lead  of  European  exporters 
by  including  such  items,  wherever  possible,  in  the  quoted  price. 
Advise  us  whether  draft  is  to  be  protested  in  case  of  non-acceptance 

[31] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

or  non-payment.  Also  state  whether  you  wish  cable  advice  of  non- 
acceptance  or  non-payment,  and  the  reason  therefore. 

Be  specific  as  to  instructions  regarding  surrender  to  drawee  of 
shipping  documents  covering  goods  for  which  draft  is  drawn,  that 
is,  as  to  whether,  in  the  event  of  draft  being  a  Time  Draft  (30,  60  or 
90  days)  such  bills  of  lading  and  other  documents  are  to  be  surrendered 
upon  acceptance  of  draft  or  upon  payment.  The  absence  of  definite 
instructions  in  this  respect  renders  necessary  cabling  to  New  York 
for  instructions  with  the  consequent  expense. 

Instructions  usually  read  to  the  effect  that  documents  accompany- 
ing Time  Drafts  on  South  America  are  to  be  surrendered  to  consignee 
on  "acceptance,"  as  otherwise  documents  would  be  held  at  the  bank 
in  foreign  country  until  payment  of  draft.  This,  in  the  case  of  a  time 
draft,  would  operate  to  the  disadvantage  of  a  responsible  consignee, 
inasmuch  as  he  would  be  stopped  from  withdrawing  the  merchandise 
from  the  custom  house  during  the  period  the  documents  remained 
with  the  bank. 

Firms  having  agents  or  representatives  in  the  foreign  field  should 
likewise  advise  the  bank  of  the  precise  powers  delegated  to  such 
representatives,  in  order  that  the  bank  may  know  just  how  far  it 
is  to  accept  instructions  regarding  any  questions  which  may  arise 
on  collection  items.  If  it  is  intended  to  confer  power  upon  agent  or 
representative  to  extend  time  on'  disputed  drafts,  to  rebate  for  pre- 
payment, to  demand  documents  of  the  branch,  to  dispose  of  or  re- 
ship  the  goods  in  the  event  of  non-payment,  etc.,  such  authority 
should  be  incorporated  in  a  regular  delegated  power  of  attorney, 
bearing  the  vise  of  a  Consul  in  this  country  of  the  South  American 
country  in  which  it  is  to  be  used.  A  copy  of  such  power  should  be 
deposited  with  this  office  to  be  forwarded  to  our  foreign  branch  in 
which  it  is  to  be  rendered  effective. 

Action  by  Foreign  Bank  on  Uncollected  Items 

IN  THE  ABSENCE  of  a  duly  appointed  agent  at  destination,  it 
is  advisable  to  leave  to  the  discretion  of  our  branch  manager  the 
steps  to  be  taken  on  uncollected  items.  Where  definite  instructions 
come  through  to  protest,  such  instructions  will,  of  course,  be  followed, 
although  in  many  instances  the  protest  of  an  uncollected  item  is  un- 
just to  foreign  drawee,  particularly  where  the  merchandise  has  not 
arrived,  or  has  arrived  in  bad  condition  or  is  not  what  was  ordered. 

[32] 


EXAMINATION  OF  MERCHANDISE 


South  American  merchants,  as  a  rule,  are  jealous  of  their  com- 
mercial probity,  and  the  protest  of  an  item  without  just  cause  creates 
a  spirit  of  antagonism  which  it  is  difficult  to  overcome.  If  this  matter 
of  protest,  however,  be  left  to  the  discretion  of  our  branch  bank 
manager  or  to  the  agent  in  foreign  country  of  the  American  shipper, 
the  transaction  may  be  amicably  adjusted  without  having  recourse 
to  this  procedure,  with  the  resultant  retention  of  the  client's  good 
will  and  future  business.  The  item  likewise  should  not  come  through 
with  instructions  "no  protest,"  as  the  branch  manager  is  thus  estopped 
from  using  this  leverage  to  compel  payment  should  circumstances 
render  such  action  advisable. 

Sale  of  Merchandise  Under  Uncollected  Items 

WHERE  required,  the  bank  will  endeavor  to  dispose  of  mer- 
chandise on  uncollected  items,  employing  the  services  of  a  local  broker 
for  this  purpose  if  necessary.  For  this  service,  a  small  charge  will 
be  made  by  our  foreign  branch  in  addition  to  the  broker's  commission. 

EXAMINATION  OF  MERCHANDISE 

WHEN     PERMITTED     IN     SOUTH     AMERICAN     COUNTRIES 
BEFORE    PAYMENT   OR   ACCEPTANCE    OF 

CORRESPONDING    DRAFTS 
Argentine 

IN  THE  ARGENTINE  it  is  not  the  custom  to  permit  of  the 
examination  of  merchandise  before  payment  or  acceptance  of  the 
corresponding  draft.  However,  if  there  is  an  understanding  between 
the  consignor  and  consignee  to  this  effect,  the  branch  will  be  guided 
by  instructions  accompanying  the  draft. 

Bolivia 

IN  BOLIVIA,  examination  of  merchandise  is  insisted  upon  be- 
fore payment  or  acceptance  of  draft.  This  is  possible  through  applica- 
tion for  special  permit  from  the  custom  authorities,  for  which  a  charge 
of  approximately  fifty  cents  (U.  S.)  is  made. 

Brazil 

IT  is  CUSTOMARY  in  Brazil  to  surrender  documents  for  ex- 
amination of  merchandise  before  acceptance  or  payment  of  corre- 
sponding draft.  American  merchants,  however,  appear  to  insist  upon 

[33] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

payment  or  acceptance  before  such  surrender.  Where  instructions  to 
this  effect  are  forwarded  to  the  branch  they  will  be  carried  out,  but 
the  impression  made  upon  Brazilian  clients  by  such  instructions  tends 
to  retard  rather  than  to  develop  Brazilian  trade. 

European  merchants  are  generally  more  elastic  in  their  terms,  and 
acquiesce  more  readily  than  do  American  merchants  in  the  customs 
of  foreign  countries. 

In  Rio  de  Janeiro,  and  at  most  of  the  Brazilian  ports,  this  ex- 
amination involves  the  release  of  the  shipment  from  custom;  and, 
in  the  event  of  refusal  on  the  part  of  drawee  to  accept  shipment, 
goods  will  be  stored  by  the  branch  for  the  account  of  shipper. 

In  Santos,  the  authorities  permit  the  examination  of  merchandise 
before  payment  of  duties,  if  declaration  is  made  to  the  effect  that 
contents  of  cases  are  unknown,  or  that  there  is  doubt  regarding  the 
classification  of  the  goods. 

For  this  privilege,  however,  the  custom  house  charges  an  additional 
5%  on  the  duties  imposed. 

It  is  customary  also  in  Brazil  to  delay  acceptance  of  correspond- 
ing drafts  until  the  actual  arrival  of  merchandise.  Many  large  firms 
refuse  to  accept  drafts,  but  agree  to  pay  at  maturity  date.  With 
such  firms  it  is,  of  course,  necessary  to  word  drafts  so  many  days, 
or  months,  after  date,  instead  of  after  sight,  in  order  to  fix  a  definite 
maturity. 

Chile 

IN  CHILE  it  is  not  customary  to  permit  inspection  of  mer- 
chandise before  payment  or  acceptance  of  drafts,  although  a  custom 
house  broker  in  good  standing  can  secure  a  permit  to  examine  the 
goods,  and  this  may  be  accomplished  in  Chile  without  actually  pay- 
ing the  duties  imposed. 

Colombia 

IN  COLOMBIA,  merchants  usually  insist  upon  examination  of 

merchandise  before  payment  or  acceptance  of  drafts. 

Ecuador 

DRAFTS,  as  a  rule,  will  be  paid  or  accepted  in  Ecuador  only 
after  arrival  of  the  corresponding  merchandise,  although  it  is  not 
customary  in  that  country  to  permit  of  examination  before  such 
payment  or  acceptance. 

[34] 


FOREIGN  STAMP  CHARGES 


Paraguay 

THE  CUSTOM  in  Paraguay  (Asuncion)  is  to  permit  examination 
of  merchandise  before  payment  or  acceptance  of  corresponding  draft. 
A  small  tax,  however,  is  imposed  by  the  authorities  for  according 
this  privilege  before  definite  release  of  shipment  from  the  customs. 

Peru 

IT  is  the  custom  in  Peru  to  permit  the  examination  of  mer- 
chandise before  the  payment  or  acceptance  of  a  draft,  although  as 
a  rule  this  privilege  is  only  availed  of  by  drawee  where  previous 
experience  gives  rise  to  doubt  or  to  a  desire  for  specific  assurance  of 
the  quality  of  goods  or  proper  packing  in  accordance  with  instruc- 
tions. 

Uruguay 

URUGUAYAN  merchants  frequently  demand  that  they  be  per- 
mitted to  inspect  merchandise  before  the  payment  or  acceptance  of 
draft.  This  privilege,  however,  is  only  accorded  upon  express  instruc- 
tions from  drawer.  If  drawee  insist,  cable  is  forwarded  to  New  York 
at  his  expense  requesting  instructions.  In  the  interest  of  the  reten- 
tion of  good  will  of  client,  it  is  advisable  in  Uruguay  to  grant  this 
permission,  as  there  is  little  doubt  of  acceptance  if  the  order  has 
been  properly  filled. 

Venezuela 

IT  is  NOT  customary  in  Venezuela  to  permit  of  examination 
of  merchandise  before  payment  or  acceptance  of  draft. 


FOREIGN  STAMP  CHARGES 

IN  all  South  American  countries,  stamp  charges  are  imposed  upon 
commercial  invoices,  receipts,  drafts,  bills  of  lading,  endorsements 
on  same,  and  upon  practically  all  documents,  legal  or  otherwise. 

Delegations  of  power,  depositions  and  such  matters  are  usually 
required  to  be  written  on  stamped  paper. 

(See  reference  under  Bills  of  Lading  to  taxes  on  endorsements  on 
Bills  of  Lading.) 

[35] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Argentine 

IN  GENERAL,  stamp  charges  on  collection  items  are  for  the 
account  of  drawee.  Stamp  duties  on  clean  or  documentary  items  are 
figured  at  }/%  per  mille  on  the  amount  involved. 

Bolivia 

IN  BOLIVIA  there  is  a  i  per  mille  stamp  on  all  drafts  forwarded 
to  that  country  for  collection,  as  well  as  upon  reimbursement  drafts 
drawn  to  cover. 

Brazil 

STAMPS  are  required  on  all  commercial  invoices,  drafts,  re- 
ceipts, bills  of  lading  and  upon  all  legal  documents.  Stamp  charges 
are  usually  2  milreis  per  conto,  the  equivalent  of  approximately  50 
cents  for  every  $250  U.  S.  currency.  The  stamp  required  on  receipts, 
however,  is  fixed  at  300  reis,  or  approximately  yj^  cents  U.  S.  cur- 
rency, irrespective  of  the  amount  for  which  the  receipt  is  drawn. 

Letters  to  us  of  advice  of  payment  of  collection  items  are  now 
subject  to  a  Government  bill  stamp  of  2  per  mille.  A  new  stamp  law 
is  about  to  go  into  effect  in  Brazil  which  will  materially  increase  the 
number  and  kind  of  documents  to  be  subject  to  stamp  tax.  This, 
however,  will  apply  more  to  domestic  than  to  foreign  documents. 

Chile 

DRAFTS  for  collection  up  to  $10,000  m/c — $0.10  m/c 

$10,000  to  $20,000  m/c —    .20  m/c 

Above  $20,000  m/c — $1.00  m/c 

On  drafts  drawn  in  foreign  currency  the  rate  is  calculated  upon 
the  equivalent  in  local  currency  at  the  rate  of  the  day  payment  is 
made.  Stamp  charges  in  Chile  should  be  for  the  account  of  drawer. 
It  is  difficult  to  collect  from  drawee  an  amount  in  excess  of  that 
called  for  in  the  draft. 

Colombia 

ALL  LIQUIDATIONS  in  Colombia,  irrespective  of  the  amount 
involved,  are  subject  to  a  bill  stamp  of  four  centavos.  On  drafts, 
this  item  is  usually  for  the  account  of  drawer. 


[36] 


FOREIGN  STAMP  CHARGES 


Ecuador 

STAMP  DUTIES  on  collections  are  one  per  mille.  This  charge 
is  deducted  by  the  collecting  bank  from  remittance,  unless  instruc- 
tions have  been  received  to  charge  this  item  to  the  drawee. 

Paraguay 

PRACTICALLY  all  instruments  originating  or  discharging  ob- 
ligations are  subject  to  a  stamp  tax  of  2  per  mille.  The  stamp  tax 
on  drafts  is  for  account  of  drawer. 

Peru 

IN  PERU  the  law  requires  that  stamps  be  affixed  to  all  in- 
voices, receipts,  drafts,  promissory  notes,  and  other  paper  repre- 
senting monetary  value.  This  tax  is  graded  to  accord  with  the  amount 
involved.  On  checks  drawn  against  bank  deposits,  the  stamp  charge 
is  2  centavos  for  each  check  irrespective  of  the  amount  for  which  it 
may  be  drawn. 

Uruguay 

THE  STAMP  duties  on  bills  of  over  $1,000,  sent  for  collection 
to  Uruguay,  are  as  follows: 

J4  per  mille  for  bills  of  less    than  10  days'  sight 
J^  per  mille  for  bills  of  more  than  10  days'  sight 
Stamp  charges  are  usually  for  the  account  of  drawer. 

Venezuela 

IN  VENEZUELA,  stamp  charges  are  imposed  on  all  documents 
at  the  rate  of  i  Bolivar  for  every  thousand  Bolivars  or  part  thereof, 
excepting  where  the  value  is  less  than  25  Bolivars.  Where  this  tax 
is  imposed  upon  drafts  it  is  generally  for  the  account  of  drawee. 


In  addition  to  the  stamp  charges  referred  to  herein,  there  is  in  most 
South  American  countries  a  rubrication  stamp  charge  on  books  of 
account.  (See  index  for  "Rubrication") 


[37] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

PROTEST  OF  DRAFTS 

Advisability  of  Protest 

THE  OBJECT  of  the  protest  of  a  draft  is  to  improve  the  legal 
position  of  drawer  or  representative  of  drawer  should  non-acceptance 
or  non-payment  result  in  recourse  to  legal  measures. 

In  South  American  countries  fees  for  legal  services  as  a  rule  are 
excessive,  and  on  this  account  it  is  advisable  on  items  of  less  than 
$  U.  S.  1,000  to  waive  protest. 

When  forwarding  drafts  to  a  bank  for  collection,  specific  instruc- 
tions should  be  given  as  to  whether  protest  is  to  be  made  for  non- 
acceptance  or  for  non-payment,  as  also  if  cable  advice  of  the  bank's 
action  is  desired.  It  will  be  noted  that  in  most  South  American 
countries  if  protest  is  to  be  filed  this  procedure  must  be  effected 
within  twenty-four  hours  after  presentation,  or  after  maturity,  and 
on  this  account  there  is  not  sufficient  time  to  cable  New  York  for 
further  instructions. 

Argentine 

A  DRAFT  drawn  at  sight  may  be  protested  for  non-payment 
at  any  time. 

If  drawn  for  a  fixed  time,  or  if  for  so  many  days  after  sight  and 
accepted,  it  should  be  protested  within  twenty-four  hours  after  date 
of  maturity. 

The  cost  of  protest,  in  the  Argentine,  averages  15  pesos  per  item. 

Bolivia 

CORRESPONDENT  banks  will  protest  uncollected  drafts,  unless 
instructions  to  the  contrary  are  received  from  drawer  or  from  bank 
forwarding  the  item  for  collection.  Protest,  in  Bolivia,  may  be  made 
for  non-acceptance  or  for  non-payment.  Protest  charges  average  about 
1 1  Bolivianos  for  each  item. 

Brazil 

ON  ITEMS  accepted,  but  not  honored  at  maturity,  cable  advice 
will  immediately  be  given  the  New  York  office  and  bill  should  be  pro- 
tested. Protest  for  non-acceptance  alone,  however,  should  be  avoided. 
An  item  may  be  protested  for  non-acceptance  within  five  years 
after  presentation  except  in  case  of  the  failure  or  dissolution  of  a 

[38] 


PROTEST  OF  DRAFTS 


firm,  under  which  contingency  protest  should  be  filed  immediately. 
Accepted  bills  should  be  protested  within  twenty-four  hours  after 
maturity.  Promissory  notes  should  be  protested  within  five  years  if 
without  endorsement.  If  endorsed,  however,  protest  should  be  made 
within  twenty-four  hours  after  maturity. 

Cost  of  protest  depends  upon  translation  charges  and  residence 
of  drawee.  The  minimum  charge  is  rarely  less  than  the  equivalent 
of  $8  U.  S.  currency. 

Chile 

IN  CHILE,  a  sight  draft  may  be  protested  for  non-payment  at 
any  time.  A  time  item  may  be  protested  for  non-acceptance  at  any 
time  before  maturity,  but  it  must  also  be  protested  for  non-payment 
at  maturity  date.  Protest  fees  in  Chile  average  25  pesos  for  each 
item. 

Colombia 

IT  is  the  custom  in  Colombia  to  protest  for  non-acceptance 
or  non-payment  unless  instructions  to  the  contrary  accompany  draft. 
If,  however,  the  draft  is  for  a  large  amount,  and  if  the  interests  of 
drawer  will  not  be  affected  by  the  delay  incident  to  cabling  for  in- 
structions, cable  will  be  sent. 

In  Colombia,  items  should  be  protested  within  twenty-four  hours 
after  presentation. 

The  fee  is  approximately  $5.00  per  item. 

Ecuador 

SIGHT  DRAFTS  may  be  protested  twenty-four  hours  after  first 
presentation.  Usance  or  time  drafts  should  be  protested  before  3  P.  M. 
of  the  day  following  maturity.  It  is  possible  to  effect  protest  after 
the  expiration  of  the  periods  referred  to,  but  only  through  lengthy 
legal  proceedings. 

Protest  fees  amount  to  about  $8.  The  protest  of  an  unaccepted 
item  does  not  improve  the  drawer's  position  in  Ecuador.  Banks,  there- 
fore, in  that  country  will  usually  protest  only  unpaid  accepted  drafts. 

Paraguay 

DRAFTS  in  Paraguay  should  be  protested  within  forty-eight 
hours  of  maturity  date.  The  cost  of  protest  averages  $60  Paraguayan 
currency. 

[39] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


PROTEST,  in  Peru,  should  be  effected  within  eight  days  follow- 
ing the  refusal  of  payment  or  acceptance.  To  protect  drawer,  it  is 
advisable  to  protest  for  non-acceptance.  Draft,  however,  should  be 
again  protested  in  the  event  of  payment  being  refused  at  maturity. 
The  term  "without  protest"  or  similar  notation  intended  to  dispense 
with  protest  is  given  no  legal  recognition  in  Peru. 

The  fee  for  the  protest  of  a  draft  in  Peru  is  the  equivalent  of  $2.50 
American  money. 

Uruguay 

IF  DRAWER  of  draft  has  no  representative  in  Uruguay,  un- 
accepted or  unpaid  items  will  be  protested  and  cable  will  be  sent 
New  York  for  further  instructions. 

Drafts  should  be  protested  the  day  payment  is  refused.  Time  bills 
protested  for  non-acceptance  should  be  protested  again  at  maturity 
for  non-payment.  There  are  no  days  of  grace  in  Uruguay. 

Protest  fees  in  Uruguay  average  $8  gold  per  item.  If  documents 
are  in  a  language  other  than  Spanish,  a  translation  charge  is  added. 

Venezuela 

PROTEST,  in  Venezuela,  for  non-acceptance  or  non-payment 
of  a  draft  must  be  made  within  six  months  from  date  of  issue.  Upon 
protesting  an  item,  it  is  necessary  to  secure  the  signature  of  the 
drawee  to  a  statement  setting  forth  his  reason  for  refusal  to  accept 
or  pay. 

Protest  fees  range  from  20  to  40  Bolivars,  as  stamped  paper  must 
be  used  for  this  purpose. 

LEGAL  SERVICES  IN  SOUTH  AMERICAN 
COUNTRIES 

THE  legal  profession  in  South  America  has  not  as  yet  developed 
specialization  in  civil  and  commercial  cases  as  is  the  case  with 
the  profession  in  this  country,  the  majority  of  the  members  of  the 
fraternity  acting  as  general  practitioners.  Where  the  premises  of  suit 
are  sound,  it  will  be  found  that  the  same  measure  of  justice  will  be 
accorded  in  the  courts  of  South  America  as  is  accorded  in  the  courts 
of  this  country.  The  fact  that  a  case  may  be  decided  against  an 

[40] 


SHIPMENTS  FROM  THE  INTERIOR 


American  client  should  not  create  prejudice  against  South  American 
justice,  as  the  basic  statutes  and  laws  covering  commerce  differ  some- 
what from  similar  laws  in  this  country  and  cases  are  adjudicated 
under  local  and  not  under  foreign  laws. 

It  is  inadvisable  to  institute  legal  proceedings  where  the  amount 
involved  is  less  than  the  equivalent  of  $1,000  gold.  The  legal  fee  on 
collection  items  averages  usually  about  fifty  per  cent  of  the  amount 
recovered. 

We  have,  in  the  files  of  our  Foreign  Trade  Department  and  at  the 
disposal  of  our  clients,  the  names  of  prominent  lawyers  in  practically 
all  of  the  principal  South  American  cities. 

SHIPMENTS  FROM  THE  INTERIOR 
FOR  EXPORT 

AS  railroads  do  not  generally  issue  through  bills  of  lading  from 
interior  points  covering  ocean  shipments  to  South  America, 
firms  in  the  interior  of  this  country  having  shipments  for  export 
should  route  them  to  an  agent  or  forwarding  house  located  at  the 
port  of  shipment,  who  will  secure  the  necessary  ocean  ladings  and 
other  documents,  as  well  as  attend  to  other  details  incidental  to 
foreign  shipments. 

It  should  be  remembered,  in  this  connection,  that  the  foreign  buyer 
is  in  no  position  to  attend  to  this  detail.  American  shippers  unfamiliar 
with  foreign  trade  frequently  assert  that  the  foreign  buyer  should 
have  an  agent  at  the  shipping  port.  Foreign  houses  disbursing  con- 
siderable money  in  this  country  usually  have  an  agent  in  New  York, 
but,  generally  speaking,  South  American  merchants  purchase  in  all 
parts  of  the  world.  It  would  therefore  be  to  the  advantage  of  the 
American  shipper  desirous  of  building  up  a  permanent  foreign  trade 
to  arrange  with  a  forwarding  house  at  the  port  of  shipment  in  this 
country  to  attend  to  the  necessary  detail. 

Drafts  covering  such  shipments  should  likewise  be  forwarded  to 
such  agent  or  forwarding  house  to  be  presented  later  on  to  this  bank, 
accompanied  with  a  complete  set  of  documents. 

If  it  be  intended  to  include  in  draft  on  foreign  client  the  ocean 
freight  and  export  house  commission,  drafts  are  occasionally  drawn 
in  blank  and  forwarded  with  invoices  to  the  agent  or  forwarding 
house  with  instructions  to  add  to  the  invoice  the  extra  charges  and 

[41] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

fill  in  the  drafts  for  the  full  amount,  presenting  such  draft,  usually 
with  a  complete  set  of  documents,  for  collection  or  discount  to  the 
bank  at  New  York.  Where  this  procedure  is  followed  it  would  be 
well,  as  an  extra  precaution,  to  make  draft  payable  to  The  National 
City  Bank  of  New  York  and  to  notify  the  bank  at  the  same  time, 
giving  the  approximate  amount  of  the  draft,  and  instructions  in 
connection  therewith. 

Many  forwarders  make  a  separate  draft  for  the  freight  and  ex- 
penses incurred  on  foreign  shipments  where  this  item  is  for  a  con- 
siderable amount,  though  this  is  usually  resented  by  foreign  client. 
Where  this  is  done,  the  draft  is  usually  made  as  a  "sight  draft"  irre- 
spective of  the  usance  on  the  draft  covering  the  merchandise,  as  it  is 
assumed  that  whatever  time  may  be  extended  applies  to  settlement 
for  the  merchandise  purchased  and  not  to  expenses  incurred  in  ship- 
ment. 

Shipments  to  Interior  Points  in  South  America 

CUSTOM  warehouses  are  located  at  the  ports  and,  before  re- 
lease of  shipments  for  interior  points  can  be  effected,  it  is  necessary 
that  duties  and  charges  be  paid.  On  this  account,  merchants  in  interior 
cities  have  an  agent  or  broker  at  the  port  through  whom  this  detail 
is  attended  to.  Our  branch  or  correspondent  bank  at  the  port  will, 
through  its  custom  house  broker,  attend  to  the  release  of  shipments 
when  so  instructed  by  consignee.  Documents  covering  interior  ship- 
ments are  held  at  the  port  by  our  branch  or  correspondent  bank. 
Draft  is  forwarded  to  a  local  bank  for  acceptance  or  payment  by 
drawee,  and  upon  telegraph  advice  to  our  branch  or  correspondent 
bank  at  port  of  acceptance  or  payment,  release  of  corresponding 
shipping  documents  is  made  to  the  agent  of  drawee,  who  attends  to 
release  from  customs  and  transshipment  to  interior. 

DOCUMENTS 

"1  yl  7~HILE  it  is  of  importance  in  connection  with  documents  cover- 
V  V  ing  shipments  to  see  that  all  the  necessary  papers  are  forwarded, 
it  is  equally  as  important  to  see  that  they  are  so  forwarded  as  to 
assure  their  reaching  destination  at  the  same  time  if  not  prior  .to  the 
arrival  of  the  shipment  they  cover.  Supplemental  mail  does  not  close 

[42] 


DOCUMENTS 


until  an  hour  or  so  before  actual  sailing  time,  and  advantage  may  be 
taken  of  this  if  delay  has  prevented  mailing  the  previous  day. 

Laxity  in  this  respect,  as  well  as  carelessness  in  the  drawing  of  the 
documents,  is  frequently  the  cause  of  the  imposition  upon  consignees 
of  heavy  fines  by  the  foreign  custom  authorities,  with  the  consequent 
ill  will  and  antagonism  which  such  carelessness  must  engender  in  the 
mind  of  the  foreign  purchaser. 

Set  of  Documents 

As  TO  what  constitutes  a  complete  set  of  documents  covering 
an  export  shipment  depends  upon  the  requirements  of  the  custom 
house  of  the  country  of  destination.  Usually,  however,  this  set  con- 
sists of:  Bills  of  lading  in  triplicate,  the  original  of  which  is  stamped 
or  viseed  by  the  Consul  of  the  country  of  destination,  resident  in 
any  of  the  large  American  cities;  Consular  invoice  in  quadruplicate; 
a  certificate  of  origin;  commercial  invoice  in  duplicate  or  triplicate; 
packing  list  in  duplicate  or  triplicate;  insurance  certificate;  and,  on 
perishable  shipments,  a  health  certificate  is  required  which  may  be 
secured  from  the  Consulate  of  the  country  of  destination. 

Bills  of  Lading 

SEE  information  under  Bills  of  Lading. 

Consular  Invoice 

CONSULAR  INVOICE  should  be  made  out  in  quadruplicate,  and 
thereon  should  appear  the  same  marks  and  numbers  as  appear  on 
the  units  making  up  the  shipment.  These  marks  and  numbers  like- 
wise appear  on  the  bills  of  lading  and  on  the  Consular  invoice  and 
on  packing  list. 

Insurance  Certificate 

IF  SHIPMENT  is  covered  under  a  blanket  or  open  policy  then, 
in  lieu  of  the  policy,  an  insurance  certificate  should  accompany  the 
other  necessary  documents.  In  the  absence  of  this  policy  or  certificate, 
drawee,  in  the  event  of  any  damage  to  shipment  in  transit,  may 
refuse  payment  or  acceptance  of  the  corresponding  draft. 


Where  but  a  few  bales,  boxes,  bundles  or  packages  are  shipped,  the 
identifying  marks  and  numbers  appearing  thereon,  and  which  must 

[43] 


OUR  SOUTH  AMERICAN  TRADE,  AND  ITS  FINANCING 

agree  with  those  mentioned  on  the  Consular  invoices  and  bills  of 
lading,  should  appear  on  the  commercial  invoice,  with  the  measure- 
ments of  the  various  units  in  inches,  though  the  metric  equivalents 
are  preferable,  as  also  the  net  and  gross  weights  which  it  is  obligatory 
to  have  appear  in  kilos,  the  metric  unit  of  weight. 

Where  numerous  units  are  being  shipped,  instead  of  embodying 
this  detail  on  the  commercial  invoice  it  may  be  made  upon  a  separate 
form,  which  is  referred  to  as  a  packing  list,  in  which  event  as  many 
such  lists  should  be  prepared  as  there  are  commercial  invoices. 

Under  the  heading  "Metric  Weights  and  Equivalents,"  in  this 
booklet,  will  be  found  the  metric  system  of  weights  and  measure- 
ments, as  also  the  South  American  countries  in  which  it  is  obligatory 
to  use  this  system  when  mentioning  weights  and  measurements  on 
shipping  documents.  There  will  also  be  found  a  comparative  table 
of  pounds  and  kilos  which  will  facilitate  the  conversion  of  weights 
from  the  avoirdupois  to  the  metric  system. 

To  impress  upon  the  minds  of  those  responsible  for  the  preparation 
of  shipping  documents  the  extreme  care  to  be  exercised  in  this  par- 
ticular, it  should  be  remembered  that  the  foreign  purchaser,  your 
customer,  is  liable  to  a  heavy  fine  being  imposed  upon  him  for  differ- 
ences which  may  occur  between  the  marks,  numbers,  weights  or 
measurements  as  appearing  on  the  Consular  invoices  and  those  given 
on  the  bills  of  lading,  commercial  invoices,  or  packing  lists. 

These  should  be  identical  on  all  documents  on  which  they  appear. 
Failure  in  this  respect  may  subject  the  entire  shipment  to  being  held 
up  by  the  foreign  custom  house,  with  the  consequent  delay  and  an- 
noyance to  foreign  client. 

Where  the  rule  of  a  foreign  custom  house  dictates  that  the  weights 
and/or  measurements  be  in  the  metric  system,  compliance  with  this 
requisite  will  greatly  facilitate  the  release  of  shipment  from  customs. 

Of  the  documents  for  release  of  shipment  from  the  foreign  custom 
house  the  most  important  is  probably  the  Consular  invoice.  Without 
this  document  a  foreign  client  is  subjected  to  considerable  delay  aside 
from  the  extreme  annoyance  entailed  by  failure  to  forward  with  the 
other  necessary  papers  this  most  important  document. 

Combined  Shipments  on  One  Set  of  Bills  of  Lading 

WHERE  VARIOUS  small  shipments  for  different  consignees  are 
packed  in  one  case  or  container  for  which  but  one  set  of  bills  of  lading 

[44] 


BILLS  OF  LADING 


can  be  obtained,  the  shipment  should  be  consigned  to  shipper's  agent 
or  to  a  general  distributor  at  the  port  of  destination.  Under  this  con- 
dition, the  shipping  documents  should  be  sent  direct  to  agent  or 
distributor  with  instructions  to  release  and  store  shipment,  and  to 
make  deliveries  to  ultimate  consignees  only  upon  instructions  from 
the  bank  through  which  collection  of  the  corresponding  drafts  is  to 
be  made;  and  when  forwarding  such  drafts  to  us,  the  accompanying 
instructions  should  be  definite  and  to  the  effect  that  upon  payment 
of  a  sight  draft  or  acceptance  of  a  time  draft  our  branch  or  corre- 
spondent bank  should  immediately  communicate  with  agent  or  dis- 
tributor (giving  his  name)  authorizing  release  of  that  part  of  ship- 
ment covered  by  the  paid  or  accepted  draft. 

BILLS  OF  LADING 

RULES    TO    BE    OBSERVED    REGARDING    LADINGS  COVERING 

SHIPMENTS  TO  THE  DIFFERENT  SOUTH 

AMERICAN  COUNTRIES 

BILLS  of  lading  consigned  "To  Order"  are  permitted  to  the  Argen- 
tine, Bolivia,  Chile,  Ecuador,  Paraguay,  Peru  and  Uruguay. 
Such  wording  is  prohibited  to  Colombia  and  Venezuela.  Bills  of  lading 
to  these  countries  should  be  consigned  direct  to  client. 

Consignment  of  Shipments 

EXCEPTING  when  shipping  under  commercial  credits,  it  is  not 
advisable  to  consign  shipments  direct  to  a  foreign  bank.  Many  foreign 
banks  refuse  to  endorse  bills  of  lading  so  consigned,  with  the  resultant 
annoyance  and  delay.  If,  for  any  reason,  shipper  does  not  wish  to 
consign  direct  to  purchaser,  then  the  bills  of  lading  should  be  made 
out  "To  Order,"  or  to  the  order  of  shipper,  with  endorsement  by 
shipper  in  blank. 

Signatures  on  copies  of  bills  of  lading  should  be  in  ink  and  not  in 
pencil.  The  duplicate  and  triplicate  copies  occasionally  come  through 
signed  with  pencil,  and,  as  the  object  of  these  extra  copies  is  to  serve 
in  the  event  of  the  loss  of  the  original  copy,  should  the  signature  be 
in  pencil  they  will  not  be  accepted  by  the  foreign  customs  authorities. 

"To  Order"  Shipments 

THE  ADVANTAGE  of  a  "To  Order"  bill  of  lading,  to  those  coun- 
tries to  which  such  consignments  are  permissible,  is  that  the  bank 

[45] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

with  which  the  corresponding  draft  has  been  placed  for  collection  is 
in  a  position  better  to  protect  the  interest  of  shipper  than  is  possible 
on  shipments  to  countries  the  rules  of  which  require  that  bills  of 
lading  be  consigned  direct  to  the  ultimate  consignee.  Under  a  "To 
Order"  bill  of  lading  the  collecting  bank  will  surrender  the  docu- 
ments only  upon  compliance  by  the  drawee  of  the  corresponding 
draft  with  the  instructions  conveyed  by  the  drawer  (shipper). 

The  disadvantage  of  a  "To  Order"  bill  of  lading  is  that,  in  the 
event  of  the  documents  not  arriving  with  the  merchandise,  the  corre- 
sponding shipment  cannot  always  be  released  by  placing  a  bond  with 
the  custom  authorities  as  is  possible  with  shipments  consigned  to 
a  direct  consignee. 

The  advantages,  however,  to  accrue  from  the  wording  "To  Order" 
on  bills  of  lading  outweigh  the  disadvantages. 

'Number  of  Ladings 

As  TO  THE  NUMBER  of  ladings  required,  this  depends  upon  the 
steamship  companies;  and,  when  in  doubt,  it  is  advisable  to  consult 
with  them  direct,  as  they  have  rules  governing  the  requirements  of 
the  various  countries  served  by  their  lines.  However,  three  negotiable 
ladings  usually  constitute  a  set. 

Tax  in  South  America  on  Bills  of  Lading 

ENDORSEMENTS  on  bills  of  lading  covering  shipments  to  South 
American  countries  are  usually  subject  to  a  varying  tax.  In  some 
countries  the  tax  is  fixed,  the  equivalent  in  American  money  for  each 
endorsement  being  approximately  $2.  In  other  countries  the  tax  im- 
posed is  calculated  on  the  value  of  the  shipment,  as  indicated  in 
declaration,  the  tax  usually  averaging  the  equivalent  of  twenty  cents 
per  one  hundred  dollars  of  value. 

As  this  tax  is  imposed  only  upon  endorsements  actually  made  in 
the  foreign  country  it  is  advisable  for  American  shippers  to  consign 
their  shipments  "To  Order"  if  the  custom  house  of  the  country  to 
which  shipment  is  made  permits  of  such  wording  (not  permissible 
to  Colombia  and  Venezuela  in  South  America,  to  which  countries 
ultimate  consignee  must  appear  on  bill  of  lading)  or  to  order  of 
shipper,  and  such  bills  of  lading  should  be  endorsed  in  blank  by 
shipper.  This  will  obviate  the  necessity  of  endorsement  by  the  bank 
in  foreign  country,  thus  eliminating  the  endorsement  tax. 

[46] 


BILLS  OF  LADING 


ARGENTINE 

Release  of  Shipments  from  Customs 
Documents  Necessary 

NEGOTIABLE  bill  of  lading,  Consular  invoice,  certificate  of 
origin. 

Bills  of  Lading — Manner  of  Consigning 

THE  WORDING  "To  Order"  or  "To  Order— Notify"  is  per- 
missible on  bills  of  lading  to  the  Argentine.  This  wording  with  blank 
endorsement  by  shipper  in  this  country  renders  unnecessary  an  en- 
dorsement by  the  bank  in  the  Argentine,  thus  avoiding  the  govern- 
ment bill  stamp  for  endorsements. 

Bills  of  Lading — Endorsement  Tax 

IN  THE  ARGENTINE,  a  stamp  tax  of  2  pesos  is  imposed  for  each 
endorsement  made  in  the  country  on  bills  of  lading. 

Release  of  Shipments  from  Customs  in  the  Absence  of  Documents 
Formalities  Imposed 

ON  DIRECT  consignments,  if  documents  are  not  at  destination 
within  eight  days  after  arrival  of  shipment,  consignee  becomes  sub- 
ject to  a  fine  of  2%  on  the  duties  imposed. 

If  declaration  has  not  been  made  within  sixteen  days  after  arrival, 
an  additional  penalty  of  5%  is  imposed. 

To  release  shipments  under  this  condition,  application  on  direct 
shipments  must  be  filed  with  the  custom  authorities  accompanied 
with  an  acceptable  bond  (usually  a  bank  guarantee)  under  which 
is  assumed  the  obligation  to  produce  the  requisite  documents  within 
ninety  days.  This  application  is  subject  to  a  stamp  tax  of  $3  Argen- 
tine paper. 

On  "To  Order"  shipments,  the  procedure  is  the  same  as  with 
"Direct"  consignments,  though  in  this  instance,  there  being  no  direct 
consignee,  the  bond  covers  the  full  value  of  the  shipment  plus  duties 
as  also  fine  in  the  event  of  goods  being  delivered  to  an  individual  or 
firm  not  intended  by  shipper. 

For  further  reference  to  Argentine  shipping,  see  page  in. 


[47] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

BOLIVIA 

Bills  of  Lading — Manner  of  Consigning 

"To  ORDER"  shipments  are  permissible  to  Bolivia. 

Bills  of  Lading — Endorsement  Tax 

THERE  is  no  stamp  charge  for  endorsements  on  bills  of  lading 
covering  shipments  to  Bolivia. 

Release  of  Shipments  from  Customs  in  the  Absence  of  Documents 
Formalities  Imposed 

RELEASE  of  merchandise,  from  the  custom  house  in  Bolivia, 
can  be  effected  only  upon  presentation  of  Consular  invoice  (five 
copies  are  necessary),  also  the  commercial  invoice.  Merchandise  not 
removed  within  one  hundred  and  eighty  days  after  entry,  in  the 
absence  of  request  to  the  government  to  hold  for  a  longer  period, 
is  auctioned  to  cover  duties  and  accumulated  storage  charges.  As 
Bolivia  has  no  seaport,  a  copy  of  the  manifest  covering  the  mer- 
chandise actually  landed  from  the  steamer  is  necessary.  This  is  pro- 
curable from  the  custom  authorities  at  the  port  of  discharge,  as  all 
Bolivian  shipments  must  conform  with  this  requisite.  The  absence  of 
Consular  invoices  renders  shipment  liable  to  a  fine  of  6  Bolivianos  for 
shipments  valued  at  200  Bolivianos  or  less,  and  4%  on  the  declared 
value  of  shipments  in  excess  of  this  amount. 

On  shipments  to  Bolivia,  all  clearances  through  the  Customs  should 
be  made  through  a  custom  broker  who  will  secure  from  the  port  of 
entry  all  the  necessary  clearance  documents.  As  the  release  of  mer- 
chandise, however,  is  for  the  account  of  consignee  this  detail  will  be 
attended  to  in  the  foreign  country.  Consular  invoices  to  Bolivia  must 
give  marks,  numbers,  class  of  merchandise,  and  statement  as  to  its 
origin  and  value. 

For  further  reference  to  Bolivian  shipping,  see  page  in. 

BRAZIL 

Release  of  Shipments  from  Customs 
Documents  Necessary 

ORIGINAL  bill  of  lading,  Consular  invoice  in  triplicate  and 
commercial  invoice.  With  these  documents,  the  custom  broker  pre- 

[48] 


BILLS  OF  LADING 


pares  what  is  known  as  a  despacho  which,  with  the  documents  referred 
to,  is  sufficient  to  effect  customs  release.  If  the  commercial  invoice 
cannot  be  presented,  goods  may  still  be  withdrawn,  but  with  the 
clause  "contents  unknown."  Where  it  is  desired  to  forward  several 
shipments  under  one  set  of  documents  this  may  be  accomplished  by 
consigning  the  merchandise  to  a  representative  or  to  a  Brazilian  firm. 
The  distribution  to  various  purchasers  may  be  made  by  direct  con- 
signee depositing  the  necessary  shipping  documents  with  the  custom 
house  issuing  thereagainst  delivery  orders  to  the  various  purchasers 
which  will  be  honored  by  the  custom  Inspector. 

Bills  of  Lading — Manner  of  Consigning 

WHILE  bills  of  lading  to  Rio  may  be  consigned  "To  Order" 
or  "To  Order — Notify,"  it  is  preferable  to  consign  shipment  "To 
Order"  or  to  the  order  of  shipper  with  endorsement  by  shipper  in  blank. 

On  shipments  coming  through  consigned  "To  Order — Notify," 
documents  can  be  negotiated  only  with  the  endorsement  of  the  in- 
dividual or  firm  notified.  Bills  of  lading  should  not  be  consigned  to  the 
order  of  a  bank,  as  such  consignment  renders  the  bank  liable  to  the 
custom  authorities  for  any  irregularity  in  connection  with  declaration 
or  clearance.  On  ladings  so  consigned,  it  likewise  becomes  necessary 
for  the  bank  to  endorse  the  documents  to  the  eventual  consignee 
rendering  necessary  the  affixing  of  bill  stamps,  resulting  usually  in 
complaint  from  drawee  on  draft  if  branch  has  been  instructed  to 
collect  from  him  the  incidental  charges. 

Where,  however,  consignment  is  made  direct  to  consignee  it  is 
advisable  to  forward  the  documents  to  the  consignee  direct  instead 
of  through  a  bank,  as  documents  so  consigned  give  the  bank  no 
authority  whatever  over  shipment. 

As  indicated  heretofore,  obstacles  are  created  under  such  wording 
where  non-acceptance  or  non-payment  of  a  draft  to  cover  renders 
necessary  the  assumption  by  the  collecting  bank  of  steps  to  protect 
the  interests  of  the  drawer,  as  control  of  the  merchandise  by  the 
bank  can  be  brought  about  only  with  the  endorsement  of  the  default- 
ing consignee,  and  this  it  may  be  difficult  to  secure. 

Bills  of  Lading — Endorsement  Tax 

ON  ENDORSEMENTS  on  bills  of  lading  it  is  advisable  to  omit 
"for  value  received"  or  "on  account"  terms  frequently  inserted  by 

[49] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

endorsers,  as  such  phrases  incur  an  additional  stamp  tax. 
The  endorsement  tax  in  Brazil  differs  at  the  various  ports. 
At  Bahia,  proportional   bill  stamps  are   imposed  amounting  to 
2$ooo  on  each  conto  (i,coo$ooo)  of  merchandise. 

At  PernambucO)  stamps  are  calculated  on  the  custom  appraisal 
value  of  the  shipment. 

Tax  on  merchandise  valued  up  to     300^000 —    400  reis 
301^000  to     500^000 —    600  reis 
501^000  to     8oo$ooo —     800  reis 
80 1  $000  to  i,ooo$ooo — i  $000 
for  every  additional  conto  (i,ooo$ooo)  or 

fraction  thereon — ijooo 
At  Rio,  stamp  charges  are  calculated 

On  shipment  estimated  at  2o$ooo  to  250^000  Rs.  $500 
On  shipment  estimated  at  250^000  to  500^000  Rs.  i$ooo 
On  shipment  estimated  at  500^000  to  750^000  Rs.  1^500 
On  shipment  estimated  at  750^000  to  i,ooo$ooo  Rs.  2$ooo 

Release  of  Shipments  from  Customs  in  the  Absence  of  Documents 
Formalities  Imposed 

IN  THE  ABSENCE  of  shipping  documents,  goods  may  be  with- 
drawn from  the  Rio  customs  under  the  following  conditions: 

With  direct  shipments  the  consignee  firm,  if  registered  with  the 
Board  of  Trade,  may  sign  what  is  known  as  a  Termo  de  Responsabili- 
dade.  Shipments,  if  consigned  in  one  name  with  the  clause  "Notify — 
another  name,"  can  be  released  by  the  direct  consignee  only  upon 
presentation  of  a  bond  and  an  authorization  signed  by  the  firm  to 
be  "notified." 

On  shipments  consigned  "To  Order — Notify,"  the  custom  house 
will  permit  withdrawal  upon  the  signing  of  a  "Termo  de  Responsa- 
bilidade"  by  the  individual  or  firm  to  be  notified.  This,  however, 
must  be  accompanied  with  a  declaration  by  a  local  bank  that  the 
release  is  in  order.  In  the  absence  of  this  declaration,  a  guarantee 
or  a  cash  deposit  will  be  accepted. 

At  Rio  de  Janeiro,  on  shipments  consigned  "To  Order"  or  "To 
the  Order  of  Shipper,"  and  endorsed  in  blank  release  cannot  be 
effected  without  the  actual  presentation  of  the  documents  even  though 
guarantee  be  given.  At  other  Brazilian  ports,  release  may  be  effected 
upon  the  guarantee  of  a  reputable  bank  or  firm. 

[50] 


BILLS  OF  LADING 


The  Termo  de  Responsabilidade  obligates  the  guarantor  to  deliver 
to  the  custom  house  the  necessary  documents  within  ninety  days  from 
date.  An  extension  of  an  additional  forty-five  days  may  be  secured 
upon  application.  Failure  to  deliver  the  documents  during  this  period 
renders  guarantor  liable  to  a  fine  of  100%  of  the  duties  imposed.  A 
separate  "Termo  de  Responsibilidade"  is  required  for  each  missing 
document,  and  is  subject  to  a  stamp  tax  of  rs.  I2$6oo,  the  equivalent 
of  about  $3.15  American  money,  and  is  not  cancelled  until  all  the 
necessary  shipping  documents  have  been  delivered  to  the  custom 
authorities. 

A  refund  of  the  fine  imposed  for  lack  of  presentation  of  documents 
within  the  period  stipulated  in  the  bond  is  possible  with  the  assent 
of  the  Minister  of  Finance. 

For  further  reference  to  Brazilian  shipping,  see  page  ill. 

CHILE 

Release  of  Shipments  from  Customs 
Documents  Necessary 

THREE  BILLS  OF  LADING,  original  of  which  should  be  stamped 
by  the  Chilean  Consul  at  the  port  of  shipment;  other  copies  should 
be  viseed  by  the  Consul. 

Consular  invoice  in  quadruplicate. 

Commercial  invoice. 

Insurance  certificate  in  duplicate.  See  note  under  "Insurance"  on 
Chilean  shipments. 

Many  exporters  have  both  the  original  and  duplicate  bill  of  lading 
viseed  by  the  Chilean  Consul,  so  that  whichever  arrives  first  may  be 
treated  as  the  original.  While  this  procedure  involves  the  added  cost 
of  the  extra  vise  it  frequently  saves  considerable  time  for  the  foreign 
purchaser,  an  element  in  promoting  good  will  and  future  business. 
Consular  charges  are  $3  per  invoice  on  amounts  up  to  $200,  and 
on  the  excess  over  this  amount. 


Bills  of  Lading  —  Manner  of  Consigning 

IT  is  PREFERABLE  to  consign  shipments  to  the  order  of  the 
shipper  with  endorsement  in  blank.  Consignments  to  Chile,  however, 
may  be  made  "To  Order  —  Notify  (name  of  consignee  firm)." 

[51] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Bills  of  Lading — Endorsement  Tax 

No  TAX  is  imposed  in  Chile  for  endorsements  on  bills  of  lading. 
As  a  document,  however,  the  bill  of  lading  incurs  a  small  stamp  tax. 

Release  of  Shipments  from  Customs  in  the  Absence  of  Documents 
Formalities  Imposed 

IN  CHILE,  consignee  is  required  to  furnish  a  guarantee  for  the 
amount  of  the  commercial  invoice,  endorsed  by  a  local  bank  and 
acceptable  to  steamship  company,  in  which  it  is  agreed  to  produce 
the  requisite  shipping  papers  within  three  months.  This,  however, 
is  permissible  only  where  shipment  comes  as  a  direct  consignment. 
A  fine  is  imposed  which,  however,  is  returnable,  if  within  ninety  days 
the  requisite  documents  are  produced. 

"To  Order"  Shipments 

GOODS  cannot  be  removed  under  "To  Order"  bills  of  lading 
until  actual  presentation  of  the  documents,  but  any  "holder"  of  a 
"To  Order"  lading  may  secure  release  of  the  corresponding  merchan- 
dise through  a  broker. 

In  Chile,  merchandise  must  be  released  through  a  Customs  broker 
whose  responsibility  to  the  government  is  guaranteed  by  an  actual 
deposit  with  the  authorities  of  60,000  pesos. 

For  further  reference  to  Chilean  shipping,  see  page  1 1 2. 

COLOMBIA 

Release  of  Shipments  from  Customs 
Documents  Necessary 

BILLS  OF  LADING  in  triplicate,  Consular  invoice  (five  copies), 
commercial  invoice,  and  packing  list. 

Bills  of  Lading — Endorsement  Tax 

ENDORSEMENTS  on  bills  of  lading  are  not  subject  to  tax  in 
Colombia. 

Bills  of  Lading — Manner  of  Consigning 

SHIPMENTS  to  Colombia  should  be  made  direct  to  consignee. 
At  this  writing  it  appears  that  "To  Order"  shipments  may  soon  be 
permissible  to  Colombia. 

For  further  reference  to  Colombian  shipping,  see  page  112. 

[52] 


BILLS  OF  LADING 


ECUADOR 

Release  of  Shipments  from  Customs 
Documents  Necessary 

BILLS  OF  LADING  in  triplicate,  Consular  invoice. 

Bills  of  Lading — Manner  of  Consigning 

SHIPMENTS  to  Ecuador  may  be  made  "To  Order,"  or  may  be 
consigned  direct  to  consignee. 

In  Ecuador,  merchandise  should  be  manifested  within  eight  days 
after  the  arrival  of  steamer,  under  penalty  of  shipment  being  for- 
feited to  the  government.  The  regulations,  however,  allow  an  exten- 
sion of  1 20  days  for  this  purpose,  if  a  solicitation  is  made  within  the 
eight-day  period.  Failure  to  manifest  the  merchandise  within  this 
period  renders  merchandise  subject  to  sale  at  government  auction 
without  recourse  on  the  part  of  the  exporter.  Once  goods  are  mani- 
fested they  must  be  removed  from  the  custom  house  within  twenty- 
four  hours  after  notice  by  the  custom  house  Administrator  that  clear- 
ance should  be  made. 

Bills  of  Lading — Endorsement  Tax 

THE  ECUADORIAN  authorities  impose  no  tax  for  endorsements 
on  bills  of  lading. 

Release  of  Shipment  from  Customs  in  the  Absence  of  Documents 
Formalities  Imposed 

IN  THE  ABSENCE  of  documents,  importer  may  secure  release 
of  the  merchandise  by  depositing  with  the  collector  of  custom  a  bank 
guarantee  that  the  necessary  documents  will  be  produced  within  120 
days.  This  guarantee  covers  the  estimated  value  of  the  shipment. 
For  further  reference  to  Ecuador  shipping,  see  page  112. 

PARAGUAY 

Release  of  Shipment  from  Customs 
Documents  Necessary 

THE  BILL  OF  LADING  in  duplicate,  a  certificate  of  origin  and 
Consular  invoice.  Shipments  via  Montevideo,  in  Uruguay,  require 
Consular  invoices  to  be  viseed  likewise  by  the  Uruguayan  Consul; 
and,  if  via  Buenos  Aires,  then  by  the  Argentine  Consul. 

[53] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Bills  of  Lading — Manner  of  Consigning 

SHIPMENTS  to  Paraguay,  via  Buenos  Aires  or  Uruguay,  should 
be  marked  in  Spanish  "Transito  para  Paraguay,"  in  order  to  avoid 
the  payment  of  duties  in  the  Argentine  or  Uruguay. 
Shipments  may  be  either  "direct"  or  "To  Order." 

Bills  of  Lading — Endorsement  Tax 

IN  PARAGUAY  there  is  no  tax  covering  endorsements  on  bills 
of  lading. 

Release  of  Shipments  from  Custom  in  the  Absence  of  Documents 
Formalities  Imposed 

IN  THE  ABSENCE  of  the  required  documents,  shipments  may 
be  released  from  custom  upon  placing  with  the  authorities  an  accept- 
able guarantee  or  a  bond  in  the  sum  of  $250  Paraguayan  currency. 
This  bond  is  returnable  if  documents  are  presented  within  sixty  days. 
For  further  reference  to  Paraguay  shipping,  see  page  113. 

PERU 

Release  of  Shipments  from  Custom 
Documents  Necessary 

THE  CUSTOM  AUTHORITIES  in  Lima,  for  the  release  of  ship- 
ments, require  the  following  documents: 

One  bill  of  lading  approved  by  steamship  agent 
One  consular  invoice 
One  commercial  invoice 

One  packing  list,  giving  irr  detail  contents  and  weight 
of  each  package. 

In  the  absence  of  packing  list,  and  where  the  commercial  invoice 
does  not  sufficiently  detail  the  contents  of  each  package  for  the  pur- 
pose of  appraisal,  the  custom  authorities  make  a  charge  of  5  soles 
($2.50)  for  each  case  which  it  becomes  necessary  for  them  to  open. 
If,  however,  the  shipment  consists  of  one  class  of  merchandise,  a  flat 
charge  of  5  soles  is  made  for  the  combined  shipment. 

Bills  of  Lading — Manner  of  Consigning 

SHIPMENTS  should  be  made  "To  Order,"  and  should  be  en- 
dorsed in  blank. 

[54] 


BILLS  OF  LADING 


Bills  of  Lading — Endorsement  Tax 

No  TAX  is  imposed  in  Peru  upon  endorsements  appearing  on 
bills  of  lading. 

Release  of  Shipments  from  Custom  in  the  Absence  of  Documents 
Formalities  Imposed 

IN  THE  ABSENCE  of  the  bill  of  lading,  if  Consular  invoice  can 
be  presented,  a  bank  guarantee  will  be  accepted  by  the  authorities 
for  the  release  of  the  corresponding  merchandise. 

In  the  absence  of  the  original  Consular  invoice,  if  a  copy  is  at 
hand,  2%  of  the  value  of  the  shipment  as  indicated  in  such  Consular 
invoice  must  be  deposited  with  the  custom  house,  this  amount  being 
returnable  upon  presentation  within  60  days  of  the  original  Consular 
invoice. 

On  European  shipments  120  days  is  granted.  Upon  special  applica- 
tion, this  time  may  be  further  extended.  In  the  absence  of  Consular 
invoices  and  other  documents,  goods  may  be  released  on  direct  ship- 
ments (not  on  "To  Order"  shipments)  upon  depositing  with  custom 
officials  25%  of  the  custom's  appraisal  of  the  shipment.  Where  this 
appraisal  necessitates  the  opening  of  cases,  an  additional  charge  ot 
the  equivalent  of  $2.50  per  case  is  imposed. 

For  further  reference  to  Peru  shipping,  see  page  113. 

URUGUAY 

Release  of  Shipments  from  Custom 
Documents  Necessary 

BILL  OF  LADING,  Consular  invoice,  certificate  of  origin,  and 
a  "Transferencia."  This  last  document  is  secured  by  the  person  or 
firm  interested  in  securing  release  of  shipment.  A  tax  of  50  cents 
Uruguayan  currency,  in  the  form  of  a  stamp,  is  imposed  on  each 
"Transferencia." 

Bills  of  Lading^— Manner  of  Consigning 

ON  "To  ORDER"  bills  of  lading,  goods  will  be  delivered  only 
to  holder  of  documents. 

Bills  of  Lading — Endorsement  Tax 

THERE  is  no  tax  in  Uruguay  on  endorsements  on  bills  of  lading. 

[55] 


Pernambtico  Branch 
The  National  City  Bank  of  New  York 

[56] 


BILLS  OF  LADING 


Release  of  Shipments  from  Customs  in  the  Absence  of  Documents 
Formalities  Imposed 

AN  APPLICATION  by  the  person  or  firm  interested  in  releasing 
shipment  must  be  made  to  the  custom  house.  The  steamship  company 
requires  a  bank  guarantee  or  other  acceptable  security  that  the  requi- 
site documents  will  be  produced  within  a  specified  period  as  also 
against  loss  for  delivery  of  shipment  to  wrong  consignee. 
For  further  reference  to  Uruguayan  shipping,  see  page  113. 

VENEZUELA 

Release  of  Shipments  from  Custom 
Documents  Necessary 

BILL  OF  LADING  in  duplicate  and  Consular  invoice,  although 
it  is  possible  in  Venezuela  to  secure  release  of  shipment  upon  pre- 
sentation of  a  duly  viseed  Consular  invoice. 

Under  this  condition,  however,  a  bond  must  be  placed  with  the 
custom  covering  the  estimated  value  of  the  shipment  and  a  document 
must  be  signed  obligating  the  individual  or  firm  making  the  release 
to  produce  the  missing  documents  within  60  days. 

Bills  of  Lading — Manner  of  Consigning 

"To  ORDER"  shipments  are  not  permissible  to  Venezuela. 

Bills  of  Lading — Endorsement  Tax 

STAMP  CHARGE  is  imposed  for  endorsements  on  bills  of  lading. 
In  Venezuela,  as  shipments  cannot  be  consigned  "To  Order,"  the 
custom  is  permissible  of  selling  the  bill  of  lading  necessitating  an 
endorsement  from  direct  consignee  to  purchaser.  To  avoid  the  stamp 
charge  for  the  endorsement,  however,  the  direct  consignee  can  give 
a  letter  of  authority  to  purchaser  which,  strange  though  it  may  seem, 
will  be  accepted  with  the  bill  of  lading  by  the  custom  authorities 
without  an  endorsement  on  the  instrument  itself. 

Release  of  Shipments  from  Custom  in  the  Absence  of  Documents 
Formalities  Imposed 

IF  DOCUMENTS  are  not  presented  within  four  days  after  arrival 
of  shipment,  release  may  be  effected  in  Venezuela  by  placing  with 
the  authorities  an  acceptable  bond  in  the  value  of  the  merchandise 

[57] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

covering  the  presentation  within  sixty  days  of  the  requisite  docu- 
ments. A  fine  of  25  Bolivars  is  imposed  for  non-presentation  of 
documents  within  the  four-day  period  and  an  additional  fine  of  5 
Bolivars  accrues  daily  until  delivery  or  until  the  expiration  of  the 
sixty-day  period  at  the  termination  of  which  the  shipment  is  con- 
sidered as  abandoned  and  is  disposed  of  at  government  auction. 
For  further  reference  to  Venezuelan  shipping,  see  page  113. 

GOODS  IN  CUSTOM  WAREHOUSE 

PERIOD    AND    CONDITIONS    UNDER    WHICH    MERCHANDISE 
MAY  REMAIN  IN  THE  CUSTOM  WAREHOUSE  AFTER 

ARRIVAL   IN    SOUTH    AMERICA 
Argentina 

AFTER  compliance  with  the  custom  regulations,  merchandise 
may  remain  in  the  custom  warehouse  for  one  year  with  the  privilege 
of  renewal  for  an  additional  year.  Storage  charges,  however,  accrue 
at  the  following  rates: 

Thirty-seven  and  one-half  cents  Argentine  gold  monthly  per  i  ,000 
kilos,  if  duties  are  to  be  assessed  on  the  value  of  the  goods. 

Seventy-five  cents  Argentine  gold  monthly  per  1,000  kilos,  if  duties 
are  to  be  assessed  by  weight. 

Forty-five  cents  Argentine  gold  per  cubic  meter,  if  duties  are  to 
be  assessed  by  value. 

These  charges  cover  for  the  first,  second  and  third  months.  Com- 
mencing with  the  fourth  month,  goods  still  remaining  in  the  custom 
are  assessed  a  50%  additional  charge  figured  on  the  above  rates,  this 
charge  to  continue  to  and  including  the  seventh  month,  after  which 
the  charge  is  increased  to  100%  of  the  rates  quoted. 

Accrued  charges  covering  drayage,  storage  and  duties  need  not  be 
paid  until  actual  removal  of  the  goods. 

Merchandise  not  intended  for  storage  must  be  removed  from  the 
custom  warehouse  within  45  days  after  arrival.  Failure  to  clear  within 
this  period  renders  shipments  liable  to  a  fine  of  5%  of  their  appraised 
value,  plus  accrued  storage  charges. 

Bolivia 

IN  BOLIVIA,  the  time  allowed  for  the  withdrawal  of  merchan- 
dise from  the  custom  house  is  180  days.  This  period,  however,  may 

[58] 


GOODS  IN  CUSTOM  WAREHOUSE 


be  extended  upon  application.  In  the  absence  of  application  being 
made  for  this  purpose,  shipments  become  liable  to  government  auction 
to  cover  duties  and  accumulated  storage  charges. 

Brazil 

As  THE  RULES  governing  the  period  during  which  merchandise 
shipments  may  remain  in  the  custom  warehouses  differ  at  the  various 
Brazilian  ports,  we  have  thought  it  advisable  to  incorporate  the  con- 
ditions governing  at  the  ports  of  Bahia,  Pernambuco,  Porto  Alegre, 
Rio  de  Janeiro  and  Santos.  The  rules  governing  at  Santos  apply 
equally  to  Sao  Paulo. 

Bahia 

THE  SYSTEM  of  graduated  warehouse  charges  in  Bahia,  cover- 
ing merchandise  left  in  the  custom  warehouse,  differs  somewhat  from 
that  prevailing  at  other  Brazilian  ports.  Thirty  days  are  given  in 
which  to  remove  shipment.  If  goods  are  removed  within  this  period, 
no  charge  is  made.  However,  in  the  event  of  shipment  being  left  with 
the  custom  for  time  in  excess  of  this  period,  a  charge  is  made  of  i% 
of  the  official  value  covering  this  first  month,  3%  for  the  second 
month,  6%  for  the  third  month,  with  a  further  3%  for  each  addi- 
tional month. 

Pernambuco 

IN  PERNAMBUCO,  the  time  limit  for  the  removal  of  merchan- 
dise from  the  custom  is  6  months.  During  this  period,  however,  storage 
charges  accrue  at  the  following  rates: 

i  month  or  less,    i%  to    2%  on  custom  appraisal  value 

1  to  2  months,      3%  to    6%  on  custom  appraisal  value 

2  to  3  months,      6%  to  12%  on  custom  appraisal  value 

3  to  4  months,     12%  to  24%  on  custom  appraisal  value 

4  to  5  months,     15%  to  30%  on  custom  appraisal  value 

5  to  6  months,     18%  to  36%  on  custom  appraisal  value 

The  higher  rates  appear  to  be  imposed  upon  merchandise  such  as 
hardware,  cement,  paper,  wool,  leather  and  machinery. 

At  the  termination  of  the  six-month  period,  merchandise  will  be  sold 
at  auction  to  reimburse  the  custom  for  duties  and  storage  charges, 
the  excess,  if  any,  being  held  subject  to  claim.  The  rule  as  to  the 
auctioning  of  merchandise  at  the  lapse  of  6  months  is  somewhat  elastic 

[59] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

in  its  application  at  Pernambuco,  and  merchandise  is  frequently  held 
for  a  longer  period,  in  which  event  the  warehouse  fee  is  increased  by 
3%  for  each  additional  month. 

Porto  Alegre 

THREE  DAYS  are  allowed  in  Porto  Alegre  for  the  payment  ot 
duties,  this  time  dating  from  the  despatch  of  the  merchandise.  Even 
though  merchandise  may  be  immediately  removed  from  the  custom, 
a  charge  for  one  month's  storage  is  made  excepting  on  bulky  mer- 
chandise which  remains  on  the  docks.  An  additional  storage  charge 
is  made  on  merchandise  remaining  in  the  custom  house  for  a  period 
of  more  than  a  month. 

Rio  de  Janeiro 

No  FINE  is  imposed  for  the  non-removal  of  merchandise  from 
the  custom.  Storage  charges,  however,  accrue  and  are  as  follows: 
ist   month  (or  fraction  thereof)  i%      of  official  value 
2nd  month  (or  fraction  thereof)  iK%  of  official  value 
3rd  month  (or  fraction  thereof)  2%      of  official  value 
4th  month  (or  fraction  thereof)  3%      of  official  value 
5th  month  (or  fraction  thereof)  3%      of  official  value 
6th  month  (or  fraction  thereof)  3%      of  official  value 
Very  bulky  merchandise  is  assessed  "double  storage." 

If,  at  the  end  of  6  months,  merchandise  is  not  withdrawn  it  is 
usually  sold  at  auction  by  the  custom  authorities,  and  the  proceeds 
are  applied  to  the  liquidation  of  the  accrued  storage  charges.  Any 
surplus  may  be  claimed  by  the  holder  of  shipping  documents  or  by 
shippers. 

Inflammable  Material  and  Perishable  Goods. — Goods  of  this  nature 
are  handled  under  special  custom  provision  under  which  they  may 
be  immediately  removed.  For  this  purpose,  it  is  necessary  to  secure 
a  document  known  as  a  "despaco  sobre  agua,"  under  which  release 
from  the  custom  authorities  may  be  effected  within  48  hours  after 
arrival. 

Santos 

STORAGE  is  charged  for  the  first  month  or  any  part  thereof,  at  the 
rate  of  2%,  calculated  on  the  declared  value;  4%  for  the  second 
month;  8%  for  the  third  month;  16%  for  the  fourth  month;  con- 

[60] 


GOODS  IN  CUSTOM  WAREHOUSE 


tinuing  to  double  up  to  the  sixth  month,  at  the  end  of  which  time  if 
merchandise  is  not  removed  the  custom  authorities  auction  the  goods 
to  cover  the  accumulated  charges. 

Machinery,  if  removed  from  the  custom  house  within  three  days 
after  its  arrival,  is  exempt  from  storage  charges.  If  not  despatched 
within  this  period  it  becomes  subject  to  tax. 

Chile 

IN  CHILE,  a  tax  of  4%  on  the  duties  imposed  is  collected  on 
all  imports  whether  removed  immediately  or  permitted  to  remain  in 
the  custom  warehouse  for  the  legal  period  of  3  months.  The  second 
3  months,  or  part  thereof,  is  subject  to  an  additional  4%,  or  a  total 
for  this  period  of  8%;  and  for  the  third  quarter  an  additional  4%, 
or  a  total  for  this  period  of  12%.  Merchandise  not  removed  at  the 
end  of  12  months  is  usually  auctioned  by  the  government  to  cover 
accumulated  charges. 

During  1918  and  I9i9>  owing  to  the  congested  condition  of  the 
custom  house  and  storage  warehouses,  goods  were  auctioned  at  the 
end  of  45  days. 

Ecuador 

IMPORTER  has  8  days  in  which  to  make  clearance.  If  goods  are 
not  cleared  within  this  time,  the  importer  becomes  subject  to  a  fine 
of  from  10  to  100  sucres,  the  non-payment  of  which  results  in  the 
forfeiture  of  the  shipment. 

This  period,  however,  upon  application  may  be  extended  for  120 
days,  at  the  expiration  of  which  time,  in  the  event  of  clearance  not 
having  been  effected,  the  shipment  is  considered  as  "abandoned"  and 
the  merchandise  will  be  sold  at  public  auction  without  recourse  on 
the  part  of  importer  or  shipper. 

Paraguay 

MERCHANDISE  remaining  in  the  Paraguay  custom  storage  be- 
yond 30  days  is  subject  to  storage  charge. 

Combustible  or  perishable  merchandise  or  merchandise  subject  to 
deterioration  should  be  removed  within  48  hours. 

Peru 

IN  PERU,  there  is  a  free  period  of  8  days  after  the  arrival  ot 
steamer  for  which  no  charge  is  made  for  storage  in  custom  house. 

[61] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Beyond  this  period,  the  charge  made  for  warehousing  is  i  %  of  the 
duties  imposed  for  the  first  month,  and  %  of  i%  for  every  additional 
month.  For  the  storage  of  jewelry  and  articles  of  exceptional  value, 
if  subject  to  duty,  the  monthly  charge  is  J^  of  i%  calculated  on  the 
declared  value.  On  articles  free  of  duty,  the  warehouse  charge  is 
5  centavos  per  100  kilos  for  the  first  30  days,  and  3  centavos  for  every 
succeeding  3o-day  period.  (The  Peruvian  centavo  is  the  equivalent 
of  approximately  ^  cent  U.  S.)  Goods  left  with  the  custom  au- 
thorities and  unclaimed  after  3  years  are  sold  at  public  auction,  the 
proceeds  in  excess  of  the  amount  due  to  the  custom  authorities  for 
duties  and  warehousing  being  held  subject  to  the  order  of  consignee. 
On  articles  entered  for  immediate  consumption,  but  which  are  free 
of  duty,  if  not  removed  within  48  hours  after  clearance,  a  demurrage 
charge  is  made  of  10  centavos  a  day  per  package,  or  per  100  kilos,  if 
the  shipment  is  imported  in  bulk.  On  dutiable  goods,  the  charge  is 
figured  at  3%  of  the  duties  for  the  first  month,  i%  for  the  second 
month,  and  %%  f°r  every  succeeding  month.  The  custom  authori- 
ties assume  no  responsibility  for  loss  by  fire  or  otherwise.  Insurance 
against  fire  by  the  importer  is  compulsory  (pilferage  insurance  cannot 
be  secured  in  Peru),  and  if  he  fails  to  cover,  the  goods  will  be  insured 
by  the  custom  authorities  for  the  account  of  the  importer. 

Uruguay 

MERCHANDISE  arriving  in  Uruguay  for  consumption  in  the 
country  may  remain  in  the  custom  warehouse  for  one  month  with- 
out payment  of  storage  charges.  After  one  month  storage  accrues  at 
the  rate  of  j/g%  per  month,  on  the  appraised  value  of  the  merchandise. 

On  bulky  material,  the  storage  charge  is  eight  centavos  gold  per 
month  per  100  kilos.  On  other  merchandise  the  charge  is  iJ4%  Per 
annum  ad  valorem.  If  payment  is  not  met  promptly,  goods  are  dis- 
posed of  at  government  auctions. 

Merchandise  in  transit  through  Uruguay  may  remain  in  the  cus- 
tom warehouse  for  one  year  free  of  storage  charges;  but,  if  at  the 
expiration  of  this  period,  it  has  not  been  removed  storage  is  charged 
from  the  date  of  arrival  at  the  rates  given  herein,  these  charges  to  be 
collected  from  claimant  of  the  shipment  or  to  be  deducted  from  the 
auction  price  received  should  the  government  so  dispose  of  it. 


[62] 


STORAGE  FACILITIES 


Venezuela 

IN  VENEZUELA,  if  documents  have  not  been  presented  within 
60  days  after  arrival  of  shipment,  the  merchandise  is  disposed  of  by 
the  government. 

If  documents  are  not  presented  within  4  days  after  arrival,  a  charge 
of  25  Bolivars  is  made  for  the  first  overdue  day,  with  an  additional 
charge  of  5  Bolivars  for  every  additional  day  following  until  the 
expiration  of  60  days,  when  shipment  is  considered  as  abandoned. 

STORAGE  FACILITIES  IN  SOUTH 
AMERICAN  COUNTRIES 

OUR  branch  and  correspondent  banks  make  a  small  commission 
charge  for  service  rendered  in  connection  with  the  warehousing 
and  insuring  of  merchandise  under  uncollected  drafts  held  for  the 
account  of  American  shippers.  This  service  renders  necessary  the  pay- 
ment to  the  bank  of  the  duties  imposed  plus  storage,  brokerage  and 
insurance  charges.  The  commission  charged  by  the  bank  is  variable, 
depending  upon  the  disbursements  involved,  as  also  upon  the  services 
and  time  required  to  complete  the  transaction. 

Argentina 

STORAGE  conditions  in  the  ports  of  the  Argentine,  both  govern- 
ment and  private,  are  adequate  to  meet  the  demand.  Warehouses  for 
incoming  shipments  are  under  government  control.  The  average  cost 
of  storage  is  given  herewith: 

If  goods  have  been  declared  according  to  value — 25  cents  Argentine 
gold  for  each  $100  Argentine  gold,  plus  an  arbitrary  50%  additional 
charge. 

If  goods  have  been  declared  according  to  volume — 30  cents  Argentine 
gold  per  cubic  meter,  plus  an  arbitrary  50%  additional  charge. 

If  goods  have  been  declared  by  weight — 50  cents  Argentine  gold  per 
ton  (1,000  kms.)  plus  an  arbitrary  50%  additional  charge. 

In  private  warehouses,  storage  charges  average  about  $1.50  Argen- 
tine paper  for  1,000  kilos,  or  Ji.io  paper  per  cubic  meter  or  fraction 
thereof. 

Bolivia 

THE  GENERAL  warehouses  in  Bolivia  are  controlled  by  the 
government. 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

'Brazil 

AT  MOST  Brazilian  ports  there  are  numerous  public  and  private 
warehouses,  the  names  of  which  we  have  on  file  in  our  Foreign  Trade 
Department  at  New  York.  The  majority  of  the  Brazilian  warehouses 
are  used  for  the  storage  of  coffee,  although  arrangements  may  be 
made  for  the  storage  of  general  merchandise. 

During  the  coffee  season  the  available  space  is  usually  insufficient 
to  cover  the  demand. 

For  the  purpose  of  establishing  insurance  rates,  warehouses  in 
Brazil  have  been  classified  as  follows: 

Class  A. — Warehouses  not  storing  dangerous  goods 

Class  B. — Warehouses  accepting  dangerous  goods 

Special. — General  warehouses. 

For  insurance  rates  governing  these  warehouses,  see  index  for 
"Insurance." 

The  storage  charges  in  Brazil  are  based  usually  upon  the  cubic 
meter,  and  average  the  equivalent  of  about  35  cents  U.  S. 

Chile 

THE  WAREHOUSES  in  Chile  are  under  private  control.  Our 
branch  at  Valparaiso  has  rented  a  floor  in  one  of  the  safest  ware- 
houses, in  which  is  stored  merchandise  on  uncollected  drafts.  There 
is  no  bonded  warehouse  in  Chile.  The  average  cost  of  warehousing 
is  5  pesos  per  month  per  case. 

Colombia 

THE  WAREHOUSE  facilities,  both  government  and  private,  are 
poor  in  Colombia. 

Ecuador 

ASIDE  from  the  custom  warehouse  there  are  no  public  ware- 
houses in  Guayaquil.  There  are  a  number  of  private  warehouses, 
however,  and  it  is  possible  to  arrange  with  the  owners  for  storage 
therein.  Storage  charges  by  the  custom  house  are  figured  at  9  cents 
per  cubic  foot.  Charges  for  private  storage  are  calculated  on  approxi- 
mately the  same  basis. 

Paraguay 

THE  WAREHOUSES  in  Paraguay  are  under  government  control, 
and  are  in  poor  condition. 


INSURANCE 


Peru 

THE  STORAGE  facilities  at  Callao,  the  port  of  Lima,  are  inade- 
quate for  the  merchandise  moving  through  that  port  and  as  a  conse- 
quence, during  congested  periods  merchandise  may  remain  in  lighters 
and  unprotected  for  weeks  at  a  time.  On  this  account  bulk  cargoes 
such  as  coal,  lumber,  cement,  etc.,  which  can  be  quickly  cleared  are 
given  preference  by  the  port  authorities  over  shipments  which  neces- 
sitate a  more  thorough  inspection.  There  are  no  private  bond  ware- 
houses in  Callao  or  Lima,  and  there  is  no  recognized  public  ware- 
house. Most  of  the  large  importers  have  their  own  warehouses,  and 
during  periods  of  the  year  when  the  movement  of  merchandise  is  not 
heavy,  space  may  be  acquired  for  temporary  storage.  The  rates  for 
this  accommodation  vary,  inasmuch  as  the  proprietors  of  these  store- 
houses do  not  solicit  this  class  of  business. 

Uruguay 

THE  STORAGE  facilities  at  Montevideo  are  restricted  to  those 
provided  by  the  custom  department  for  incoming  goods. 

Venezuela 

IN  CARACAS,  there  is  no  government  storehouse  and  there  is 
but  one  private  warehouse,  the  charges  for  storage  in  which  vary 
with  the  class  of  merchandise  stored.  Some  of  the  local  banks  have 
storage  space  which,  however,  is  restricted  to  the  storing  of  mer- 
chandise upon  which  advances  have  been  accorded. 

INSURANCE  IN  SOUTH  AMERICA 
ON  MERCHANDISE  UNDER  UNCOLLECTED 

DRAFTS 

INSURANCE  on  foreign  shipments  where  possible  should  cover 
theft  as  well  as  ordinary  marine  risks,  and  policy  should  be  issued 
to  cover  10%  in  excess  of  the  invoice  value  as  also  a  period  of  from 
10  to  30  days  after  arrival  at  foreign  port,  preferably  30  days  for 
Chilean  shipments;  in  other  words,  from  warehouse  of  shipper  to 
warehouse  of  purchaser.  This  is  necessary,  as  otherwise  our  branch 
or  foreign  correspondent  bank  holding  the  documents  is  forced  to 
cover  for  the  period  intervening  between  the  receipt  and  surrender 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

of  documents  and  the  attempt  to  collect  the  cost  of  this  insurance 
from  purchaser  usually  results  in  friction. 

BLANKET    POLICIES 

WHERE  shipments  are  insured  under  blanket  policies,  a  certificate 
should  accompany  the  shipping  documents,  as  otherwise  importers 
frequently  refuse  to  accept  drafts.  This  certificate  is  required  so  that 
they  may  see  just  what  risks  are  covered  thereby. 

Argentina 

GOODS  PLACED  in  private  warehouse  by  the  bank,  or  shipments 
specifically  declared  on  deposit  with  the  custom  authorities  are  in- 
sured by  the  bank  against  fire  risk  for  the  account  of  whom  it  may 
concern.  Insurance  covering  pilferage,  however,  cannot  be  secured 
covering  merchandise  in  the  custom  warehouse. 

In  the  Argentine,  there  are  local  companies  as  also  branches  of 
British  and  American  companies.  The  annual  premium  on  merchan- 
dise in  custom  depots  is  i%.  In  the  average  private  warehouse  the 
premium  varies  between  3  and  yj^  per  mille,  although  in  the  best 
warehouses  the  premium  is  25  per  mille. 

Bolivia 

IN  BOLIVIA  there  are  branches  of  several  foreign  insurance 
companies.  There  is  but  one  local  company.  In  the  local  company 
the  rate  is  4  o/oo  per  annum. 

Brazil 

AT  THE  various  ports  of  Brazil  there  are  local  companies,  as 
well  as  branch  offices  of  reliable  foreign  insurance  companies. 

The  rates  range  about  as  follows,  the  classification  referring'to  the 
class  warehouse  in  which  merchandise  is  stored. 
Government  and  private  warehouses  at  Rio: 

Class  A — Insurance  rates,  J^%  to  Y%% 
Class  B— Insurance  rates,  %%  to  %% 
Special  — Insurance  rates,  %%  to  2% 

Insurance  may  be  effected  for  a  period  of  three  months  if  desired. 

In  Rio  there  are  39  companies  engaged  in  the  business  of  insuring 

warehoused  merchandise.  Nineteen  of  these  companies  are  local, 

12  English,  3  German,  2  Portuguese,  i  French,  i  Argentine,  and 

i  Swedish. 

[66] 


INSURANCE 


Chile 

ON  CHILEAN  shipments  it  should  be  noted  that  insurance 
should  specifically  cover  30  days  at  Valparaiso,  particularly  on  mer- 
chandise transshipped  at  Panama.  The  usual  y-day  clause  at  Val- 
paraiso is  not  sufficient.  Our  Chilean  branches  see  that  merchandise 
placed  by  them  in  storage  is  covered  by  insurance,  if  this  detail  has 
not  been  arranged  for  by  shipper  or  consignee. 

All  merchandise  for  which  our  Chilean  branches  hold  documents 
is  covered  by  insurance  whether  removed  from  custom  house  or  not. 
Policies,  however,  do  not  cover  theft. 

Losses  along  the  West  Coast  of  South  America  from  pilferage,  par- 
ticularly in  textiles  and  silks,  have  become  so  prevalent  that  many 
insurance  companies  will  not  issue  "theft  insurance,"  and  the  rates 
of  companies  which  still  carry  this  risk  are  prohibitive. 

There  are  a  few  local  insurance  companies  in  Chile,  but  the  bulk 
of  the  business  is  placed  with  branch  offices  of  foreign  companies. 
The  average  cost  of  insurance  in  these  companies  is  4  o/oo  for  a 
period  of  3  months. 

Colombia 

IN  COLOMBIA  there  are  branches  of  various  foreign  insurance 
companies  and  some  local  companies.  The  average  cost  of  insurance 
on  merchandise  in  warehouse  is 


Ecuador 

MERCHANDISE  in  custom  warehouses  or  stored  in  private  ware- 
houses may  be  insured  against  fire,  as  also  against  earthquake  and 
volcanic  eruptions.  Insurance  companies  in  Ecuador  are  all  branches 
of  foreign  companies.  In  Guayaquil  there  are  represented  nine  British 
companies  and  one  American  company.  Rates  vary,  but  the  average 
rate  is  4^%  m  private  warehouses  and  6J^%  in  the  custom  ware- 
house. These  rates  appear  to  be  excessive. 

Paraguay 

IN  PARAGUAY  there  are  branches  of  European  and  Argentine 
insurance  companies. 

Peru 

MERCHANDISE  warehoused  at  Callao  may  be  insured  against 
fire.  There  are  8  insurance  companies  in  Callao,  the  rates  of  which 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

through  a  protective  agreement  are  the  same.  The  rate  on  merchan- 
dise stored  in  the  custom  warehouse  at  Callao  is  %%  annually, 
figured  on  the  valuation.  The  rate  on  goods  stored  in  private  houses 
is  %%  annually.  Goods  stored  for  a  period  of  longer  than  8  months 
and  up  to  a  year  pay  the  yearly  rate.  The  rate  for  a  period  under 
8  months  is  J^  of  the  full  year's  premium  per  month. 

Uruguay 

MERCHANDISE,  when  permitted  to  remain  in  the  custom  ware- 
house, is  insured  by  the  bank  if  we  hold  the  documents.  Only  fire 
insurance  on  such  merchandise,  however,  is  procurable  in  Montevideo. 
The  average  cost  of  fire  insurance  in  Uruguay  is  7^  per  mille  per 
year.  On  insurance  premiums  the  government  tax  is  4%. 

Venezuela 

MERCHANDISE  in  warehouse  in  Venezuela  may  be  insured  in 
a  local  company  which,  however,  reinsures  in  one  of  the  English  com- 
panies. The  average  cost  of  insurance  is  He  per  mille  figured  on  the 
value  of  the  merchandise  covered. 

POSTAGE  RATES  AND  CONDITIONS  IN 
SOUTH  AMERICAN  COUNTRIES 

First  Class 

LETTERS  AND  POSTAL  CARDS. — Postage  on  letters  is  five  (5) 
cents  for  the  first  ounce  or  fraction  thereof,  and  three  (3)  cents  for 
each  additional  ounce  or  fraction  thereof. 

Except. — British  Guiana,  where  the  rate  is  two  (2)  cents  for  each 
ounce  or  fraction  thereof. 

POSTAL  CARDS. — The  postage  on  a  single  card  bearing  a 
written  communication  is  two  (2)  cents  for  each  ounce  or  fraction 
thereof. 

REGISTERED. — Register  all  valuable  matter.  Registration  fee 
ten  (10)  cents  additional. 

Third  Class 

PRINTED  MATTER. — Embraces  all  newspapers,  periodicals, 
books,  pamphlets,  sheet  music,  cards,  proofs  of  printing,  etc. 

The  postage  is  one  (i)  cent  for  each  two  (2)  ounces  or  fraction 
thereof. 

[68] 


MAIL  TIME 


The  limit  of  weight  is  four  pounds  six  ounces  (4  Ibs.  6  oz.). 

The  limit  of  size  is  eighteen  (18)  inches  in  one  direction,  except 
printed  matter  in  rolls  which  may  be  thirty  (30)  inches  in  length  and 
four  (4)  inches  in  diameter. 

REGISTERED. — All  valuable  matter.  Registration  fee  ten  (10) 
cents  additional. 

Fourth  Class 

MERCHANDISE. — (See   special   reference   in  Index   to   "Parcel 
Post.") 

MAIL  TIME  TO  PRINCIPAL  CITIES  OF 
SOUTH  AMERICA 

THE  time  given  to  the  South  American  cities  mentioned  in  this 
table  is  the  sailing  or  transit  period.  Consideration,  however, 
should  be  given  to  the  possibility  of  10  or  15  days  intervening  between 
the  date  a  letter  is  posted  and  the  actual  sailing  date  of  steamer. 
This  allowance  is  applicable  likewise  to  sailings  from  South  America, 
and  should  be  considered  when  calculating  the  possible  time  to  elapse 
before  a  reply  may  be  expected  to  South  American  mail. 


MAIL   TIME    TO 


ARGENTINA 
BUENOS  AIRES. 
ROSARIO..  . 


Day. 

26 
28 


BOLIVIA 

LxPAz 25 

SUCRE 25 

ORURO 25 

BRAZIL 

Rio  DE  JANEIRO 18 

SANTOS 21 

BAHIA 15 

PERNAMBUCO 14 

PORTO  ALEGRE 25 

SAO  PAULO 20 

PARA     16 

CHILE 

SANTIAGO 29 

VALPARAISO 28 

PUNTA  ARENAS 40 


Reply  may 

be  expected 

in  D»JI 

75 
80 


75 
75 

75 

65 
65 
60 

55 
80 

65 

60 


75 

75 

no 


COLOMBIA 

BOGOTA 23 

MEDELLIN 23 

ECUADOR 

QUITO 15 

GUAYAQUIL 15 

GUIANAS 

BRITISH 12  to  15 

FRENCH 1 2  to  1 5 

DUTCH 12  to  15 

PARAGUAY 
ASUNCION  35 

PERU 

LIMA 18 

CALLAO 17 

URUGUAY 
MONTEVIDEO 25 

VENEZUELA 

CARACAS 12 

MARACAIBO 14 


Reply  may 

be  expected 

in  Days 


45 
45 


[69] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

PARCEL-POST  TO  SOUTH  AMERICAN 
COUNTRIES 

Fourth  Class 

MERCHANDISE  PARCEL-POST. — Postage  is  twelve  (12)  cents 
for  each  pound  or  fraction  thereof.  Greatest  length,  three  (3)  feet 
six  (6)  inches.  Greatest  length  and  girth  combined,  six  (6)  feet. 

REGISTER. — All  valuable  matter.  Registration  fee  ten  (10) 
cents  additional. 

Except. — That  parcel-post  to  the  following  countries  cannot  be  regis- 
tered: French  and  Dutch  Guiana,  Argentina,  Uruguay  and  Paraguay. 

Parcel-Post 

FOR  SOME  unaccountable  reason,  the  South  American  coun- 
tries having  treaties  with  the  United  States  relative  to  the  inter- 
change of  parcel-post  shipments  do  not  appear  to  regard  this  medium 
with  favor,  if  one  may  judge  by  the  vexatious  delays  to  which  such 
shipments  are  subjected  at  destination  as  well  as  the  extra  taxes  and 
duties  imposed  thereon. 

The  bank  cannot  handle  such  shipments,  owing  to  the  complexity 
of  the  exactions  by  the  foreign  custom  authorities  and  the  obliga- 
tions assumed  or  thrust  upon  the  bank  where  the  packages  are  sent 
direct  to  our  branches.  There  is  no  protection  to  sender  of  packages 
where  parcel-post  shipments  are  sent  in  care  of  a  bank,  inasmuch 
as  only  the  direct  addressee  and  not  the  individual  or  bank  in  whose 
care  it  is  sent  will  be  recognized  by  the  custom  authorities  for  its 
release.  It  is  possible,  of  course,  to  have  the  direct  addressee  confer 
power  of  attorney  on  the  bank  for  this  purpose,  but  this  would  defeat 
the  very  purpose  the  sender  has  in  mind  in  forwarding  such  ship- 
ments in  the  bank's  care. 

Foreign  houses  frequently  experience  difficulty  with  the  custom 
authorities  when  American  goods  arrive  in  packages  which  bear  the 
retail  selling  price.  All  such  price  marks  should  be  removed. 

REGULATIONS    GOVERNING    PARCEL-POST   SHIPMENTS    FROM 
THIS    COUNTRY   TO    THE    VARIOUS    COUNTRIES    OF 

SOUTH   AMERICA 
Argentina 

OBSERVATIONS. — Limit  of  weight  for  parcels  22  pounds.  Parcels  cannot  be  regis- 
tered. Two  copies  of  the  custom  declaration  (Form  2966)  must  be  attached  to 

[70] 


PARCEL-POST 


each  parcel  and  the  name  and  address  (street  and  number  as  well  as  city)  of  the 
addressee  must  be  written  on  both  copies  as  well  as  on  the  parcel  itself. 

PARCELS  are  accepted  for  mailing,  even  though  sealed  and  closed  against  inspec- 
tion, provided  they  conform  to  other  conditions  prescribed. 

PROHIBITIONS. — Triangular  daggers  or  stilettos  and  their  blades;  iron  knuckles. 

No  CONSULAR  INVOICE  or  other  documents  are  necessary  on  parcel 
post  shipments  to  the  Argentine.  It  is  advisable,  however,  to  forward 
with  such  packages  a  "Declaration,"  which  may  be  secured  through 
an  Argentine  Consul. 

Stamp  charges  and  duties  on  parcel-post  shipments  are  excessive 
in  the  Argentine,  amounting  in  some  instances  to  more  than  the 
actual  value  of  the  merchandise.  In  addition  to  custom  duties,  the 
taxes  imposed  on  parcel-post  shipments  are: 

i. — $2.69  Argentine  paper  if  the  package  is  addressed  to  an  in- 
dividual (not  a  firm),  and  if  the  contents   of  the   package 
are  not  dutiable. 
2. — $4.69  Argentine  paper  if  addressed  to  an  individual  (not  a 

firm),  and  if  the  contents  of  the  package  are  dutiable. 
3. — $4.69  Argentine  paper  if  addressed  to  a  firm,  whether  the  con- 
tents of  package  are  dutiable  or  not. 

Bolivia 

OBSERVATIONS. — Limit  of  weight  for  parcels  u  pounds. 

PROHIBITIONS. — Articles,  the  sale  of  which  is  a  state  monopoly.  Tobacco  in  any 
form;  plants  and  shrubs  in  baskets;  gold  and  silver  substances,  jewels  and  other 
precious  articles;  nickel  or  silver  coins,  and  counters  and  chips  indicating  value. 

The  importation  into  Bolivia  of  guns  and  of  arms  and  ammunition  is  subject  to 
restrictions  prescribed  by  the  customs  regulations. 

PARCEL-POST  shipments  to  Bolivia  must  be  accompanied  with  a 
"Declaration"  from  a  Bolivian  Consul.  There  is  a  warehouse  tax  of 
the  equivalent  of  about  25  cents  U.  S.  money  on  all  packages  coming 
through  by  this  medium.  There  is  also  a  special  fee  of  3  Bolivianos 
(the  equivalent  of  about  $1.25  U.  S.)  covering  documentary  solicita- 
tion for  release  on  all  parcel-post  shipments  appraised  at  200  Boli- 
vianos or  less.  On  appraisements  in  excess  of  this  amount,  this  Con- 
sular fee  is  collected  at  the  rate  of  2%  on  the  appraised  value.  On 
appraisements  of  10  Bolivianos  or  less  no  Consular  fee  is  charged. 


Brazil 


OBSERVATIONS. — Limit  of  weight  for  parcels,  21  pounds.  The  parcel-post  service 
to  Brazil  is  strictly  limited  to  the  cities  of  Curity ba,  Rio  de  Janeiro,  Sao  Paulo, 
Bello  Horizonte,  Bahia,  Pernambuco  (Recife),  and  Para  (Belem). 

[71] 


Map  of  South  America  showing  Branches 


[72] 


f  The  National  City  Bank  of  New  York 


[73] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


PARCELS  addressed  to  other  destinations  in  Brazil  can  only  be  delivered  if  arrange- 
ments have  been  made  by  the  addressee  for  their  transmission  from  one  of  the 
seven  above-mentioned  offices  to  the  office  of  destination;  and  the  United  States 
Post  Office  Department  can  only  accept  parcels  for  delivery  beyond  said  Brazil 
offices  of  Curityba,  Rio  de  Janeiro,  Sao  Paulo,  Bello  Horizonte,  Bahia,  Pernam- 
buco  (Recife)  and  Para  (Belem)  at  the  sender's  risk.  Such  parcels  must  be  in» 
dorsed  by  the  senders,  on  the  address  side:  "Sender's  Risk"  or  "Delivery  Ar- 
ranged." Parcels  addressed  "Poste  Restante"  are  unmailable. 

The  parcel-post  convention  with  Brazil  provides  as  an  exceptional  measure  that 
fatty  substances,  liquids  and  those  which  easily  liquefy  may  be  included  in  par- 
cels exchanged  under  the  convention,  but  ONLY  when  packed  so  as  to  thoroughly 
protect  other  articles  from  damage  in  case  of  accident. 

Packages  containing  prospectuses  and  advertisement  bills,  e.  g.,  engravings, 
printed  books,  periodical  publications,  reviews,  geographic  maps,  bound  music 
sent  separately  or  in  pamphlet  form,  are  subject  to  an  entry  duty  of  150  reis 
(5  cents)  if  the  amount  shipped  weighs  more  than  2  kilograms  (4.4  Ibs.)  in  weight 
per  addressee. 

No  CONSULAR  INVOICE  or  other  documents  necessary.  Brazil  is  a 
country  in  which  particular  difficulty  is  experienced  with  shipments 
via  parcel-post. 

Bahia 

THERE  is  no  special  tax  in  Bahia  on  parcel-post  shipments. 

Pernambuco 

THIRTY  DAYS  is  the  usual  period  required  for  the  custom  re- 
lease of  parcel-post  shipments.  To  effect  clearance,  it  is  necessary  to 
employ  the  services  of  a  custom  broker,  and  where  the  bank  is  in- 
structed by  drawer  of  corresponding  draft  to  "Collect  all  charges" 
annoyance  and  delay  frequently  is  caused  through  the  refusal  of  drawee 
to  defray  the  various  expenses  incurred  in  effecting  release.  These  ex- 
penses at  Pernambuco  are  exorbitant  and  consist  of: 

Bill  stamp  on  legal  form  delegating  to  broker  authority  to  retire 
the  shipment,  600  reis. 

Clearance  stamp  per  conto  or  part  thereof,  2$ooo. 

Post  office  charge  calculated  on  weight  per  pound,  260  reis. 

Broker's  commission,  average  per  package,  5 $000. 

Custom  duties  figured  on  weight  or  ad  valorem. 

Registered  packages,  in  addition  to  the  260  reis  per  pound,  are 
subject  likewise  to  an  additional  stamp  charge  of  300  reis. 

Porto  Alegre 

PARCEL-POST  packages  for  interior  points  and  some  coast  ports 
in  Brazil  are  held  at  the  custom  house  at  the  port  of  disembarkation, 

[74] 


PARCEL-POST 


a  notice  being  sent  by  the  custom  authorities  to  addressee  to  appear 
personally,  or  through  his  agent,  at  the  examination  of  the  contents. 
Such  agent  at  port,  in  order  to  act,  must  be  supplied  by  addressee 
with  a  power  of  attorney  duly  drawn  before  a  notary  public,  as  other- 
wise authority  to  release  will  not  be  recognized.  On  this  account,  and 
in  order  to  facilitate  delivery  of  packages  sent  by  this  medium  it  is 
advisable  when  addressing  parcel-post  packages  to  clients  residing 
back  from  the  coast  to  arrange  with  them  to  have  such  packages 
addressed  direct  to  some  one  at  the  port  who,  after  release,  can  for- 
ward package  to  client. 

Rio  de  Janeiro 

MAXIMUM  weight  6  kilos,  the  equivalent  of  13  pounds.  Great- 
est length  3  feet  6  inches.  Greatest  length  and  girth  combined  6  feet. 
If  cylindrical  in  form,  length  should  not  exceed  6  feet.  Accompanying 
each  parcel  should  be  a  list  containing  a  complete  description  of  the 
parcel,  its  value,  contents,  name  and  address  of  remitter.  The  con- 
tents of  parcel-post  packages  are  subject  to  a  stamp  tax  of  400  reis 
(the  equivalent  of  10  cents)  per  pound.  Parcel-post  packages  are  like- 
wise subject  to  the  usual  storage  charges  while  in  the  custom  ware- 
house of  i%  of  official  value  for  the  first  month  or  fraction  thereof, 
XH%  for  the  second  month,  2%  for  the  third  month,  and  3%  for 
the  fourth  month. 

Santos 

THE  CONTENTS  of  parcel-post  packages  are  subject  to  the  same 
duties  as  merchandise  sent  on  ocean  bill  of  lading.  Package  should 
not  exceed  60  cms.  on  any  side,  canes  and  umbrellas  excepted,  and 
must  not  exceed  5  kilos  in  weight.  Parcels  may  be  cleared  by  con- 
signee or  his  authorized  agent. 

Chile 

OBSERVATIONS. — Limit  of  weight  for  parcels  n  pounds. 

PROHIBITIONS. — Articles  injurious  to  health;  firearms,  except  upon  presentation 
by  the  addressee  of  a  permit  issued  by  the  governor  of  the  province;  cinemato- 
graphic films. 

No  SPECIAL  TAX  or  excess  duties  are  imposed  on  parcel-post  packages, 
such  shipments  being  subject  to  the  same  duties  as  are  imposed  upon 
freight  shipments.  However,  all  merchandise  entering  Chile,  whether 

[75] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

by  parcel-post  or  otherwise,  must  be  covered  by  a  Consular  invoice 
in  quadruplicate.  These  forms  may  be  secured  at  the  Consular  office 
in  any  large  American  city,  the  charge  being  30  cents  per  set  of  four 
forms.  On  a  parcel-post  shipment,  the  value  of  which  is  less  than 
|25,  no  Consular  fee  is  charged,  although  a  set  of  Consular  invoices 
is  necessary.  For  shipments  by  this  medium,  the  value  of  which  is 
between  $25  and  $200,  a  Consular  fee  of  $3  is  charged  for  each  Con- 
sular set  of  four  forms  covering  individual  shipments.  On  amounts 
in  excess  of  $200,  an  additional  %%  is  charged,  figured  on  such 
excess. 

To  secure  release  from  custom  of  parcel-post  shipments,  an  appli- 
cation must  be  made  by  consignee  to  the  post  office,  the  fee  for  which 
is  40  cents  Chilean  plus  one  Chilean  peso  for  each  package  removed. 
If  shipment  is  one  for  which  a  Consular  invoice  is  necessary,  an 
additional  40  cents  Chilean  is  imposed. 

Colombia 

OBSERVATIONS. — Limit  of  weight  for  parcels  22  pounds.  The  conditions  of  transit 
in  Colombia  are  exceptional;  parcels  should  therefore  be  strongly  packed  to 
avoid  damage.  Paintings,  chromo  cards  and  printed  books  are  subject  to  cus- 
tom duty.  Shot  guns  and  rifles  for  sporting  use  are  mailable  if  so  declared.  The 
collection  of  custom  duty  upon  parcels  from  other  countries  is  required  in  every 
case  in  which  the  addressee  has  caused  the  parcel  to  be  opened  and  assessed,  not- 
withstanding said  parcel  is  subsequently  refused  by  the  addressee.  In  such  cases 
the  amount  of  the  custom  duty  must  be  paid  by  the  sender  before  the  parcel  will 
be  returned  to  him. 

PROHIBITIONS. — National  silver;  copper  and  nickel  coins;  National  paper  and 
postage  stamps  with  the  seal  or  shield  of  the  Republic;  anethol  or  oil  of  anis; 
machines  to  coin  money;  umbrellas  with  swords;  plates  for  making  notes  with 
the  name  of  the  Republic.  Secret  arms  such  as  sticks,  umbrellas  and  foils  with 
rapiers  or  daggers  hidden  from  sight,  carbines,  rifles,  and  in  general,  arms 
properly  so  called,  for  individuals.  Firearms  are  not  prohibited  importation 
when  intended  for  the  government.  Revolvers  may  be  imported  as  well  as 
percussion-cap,  ramrod  or  muzzle-loading  or  cartridge  guns  and  air  guns, 
together  with  their  accessories. 

A  SPECIAL  TAX  is  imposed  on  parcel-post  shipments  calculated  at  5% 
of  the  value  as  indicated  by  the  commercial  invoice,  copies  of  which 
in  triplicate  should  be  sent  direct  to  consignee  in  the  same  mail  carry- 
ing the  package.  This  tax  is  in  addition  to  the  custom  duties  to  be 
imposed.  The  limit  of  weight  is  22  pounds,  or  10  kilos. 

Ecuador 

OBSERVATIONS. — Limit  of  weight  for  parcels,  20  pounds.  A  collection  is  made  of  a 
fourth  of  a  centavo  for  each  kilogram  of  gross  weight  of  each  package  imported 
or  exported. 

[76] 


PARCEL-POST 


PROHIBITIONS. — Sugar-cane  brandy  and  its  combinations;  articles  of  food  con- 
taining ingredients  that  are  injurious  to  health;  salt;  foreign  coin  and  any  outfit 
for  coining. 

No  SPECIAL  documents  are  necessary  on  parcel-post  shipments  to 
Ecuador.  However,  the  import  duty  is  50%  more  on  shipments  com- 
ing via  this  medium  than  on  those  coming  by  freight.  A  minor  tax 
of  the  equivalent  of -one  cent  U.  S.  currency  per  package  is  likewise 
imposed  upon  all  parcel-post  packages. 

Guianas 

THERE  is  no  special  tax  on  parcel-post  shipments  entering  the 
Guianas. 

BRITISH  GUIANA.    OBSERVATIONS.— Limit  of  weight  for  parcels  1 1  pounds. 

PROHIBITION. — Parts  of  articles  subject  to  custom  duty,  except  by  special  per- 
mission. 

DUTCH  GUIANA.  OBSERVATIONS.— Limit  of  weight  for  parcels  n  pounds. 
Parcels  cannot  be  registered. 

PROHIBITIONS. — Confections  and  paste,  coin,  dutiable  articles,  gold  and  silver 
articles,  precious  stones,  jewelry  and  other  valuables. 

FRENCH  GUIANA.  OBSERVATIONS.— Limit  of  weight  for  parcels  n  pounds. 
Parcels  cannot  be  registered. 

PROHIBITIONS,  ETC. — The  same  as  for  France,  except  that  tobacco  may  be  im- 
ported subject  to  the  payment  of  custom  duty  and  other  charges. 

Paraguay 

OBSERVATIONS. — Limit  of  weight  for  parcels  22  pounds.  Parcels  cannot  be  regis- 
tered and  are  subject  to  transit  charges. 

PARCEL-POST  shipments  do  not  require  a  Consular  invoice.  The  weight 
limit  is  n  pounds;  dimensions  should  not  exceed  three  (3)  feet  six  (6) 
inches  greatest  length,  six  (6)  feet  greatest  breadth.  Owing  to  Para- 
guayan mail  going  through  the  Argentine,  an  additional  charge  of 
30  cents  on  each  parcel  ^covering  /'transit  service"  is  collected  at 
destination. 

In  Paraguay  there  is  no  special  tax  on  parcel-post  shipments;  con- 
tents, however,  may  be  dutiable. 

Peru 

OBSERVATIONS. — Limit  of  weight  for  parcels,  22  pounds. 
PROHIBITIONS. — Arms  and  ammunition  of  war.  Tobacco  in  any  form. 

IN  ADDITION  to  the  duties  imposed  on  the  contents  of  parcel-post 
packages,  there  is  a  tax  of  the  equivalent  of  30  cents  U.  S.  on  every 
package  so  forwarded  from  America.  On  packages  received  from 
Europe  by  this  medium,  the  tax  is  only  10  centavos  (the  equivalent 
of  5  cents  American  money)  owing  to  a  reciprocal  agreement  between 

[77] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


Peru  and  European  governments  in  this  connection.  The  limit  of 
weight  is  22  pounds. 

Uruguay 

OBSERVATIONS. — Limit  of  weight  for  parcels  n  pounds.  Parcels  cannot  be  regis- 
tered. The  following  consular  fees  are  collected  in  Uruguay  on  parcel-post  pack- 
ages from  the  United  States:  For  all  parcels  on  which  the  custom  duties  assessed 
exceed  2  pesos  ($2.068),  the  fee  is  I  peso  ($1.084);  for  all  parcels  subject  to  cus- 
tom duties  not  exceeding  2  pesos,  the  fee  is  only  20  centimos  (20.68  cents);  and 
for  parcels  which  are  free  of  duty,  no  fee  is  collected. 

It  is  understood  that  in  case  the  fee  is  paid  to  the  Uruguayan  consul  at  the  place 
of  mailing  in  the  United  States,  it  is  not  collected  in  Uruguay,  the  amount  of  the 
fee  being  the  same  in  either  case. 

PROHIBITIONS. — Gold  and  silver  coin,  except  ancient  money  intended  for  collec- 
tors, not  exceeding  10  pieces  in  any  one  parcel;  vines  and  parts  thereof;  other 
living  fruit  plants,  flower  plants,  ornamental  plants  and  parts  thereof,  unless 
accompanied  by  a  certificate  of  grower,  duly  signed  by  competent  authorities  and 
visaed  by  the  Consul  of  Uruguay  to  the  effect  that  there  have  been  no  vines  on 
his  property  for  five  years. 

NOTE. — Parcel-post  packages  are  accepted  for  any  place  in  Uruguay,  but  parcels 
destined  for  places  other  than  those  mentioned  below,  will  not  be  sent  to  the 
place  named  in  the  address,  but  will  be  sent  to  the  nearest  parcel-post  office, 
where  they  will  be  held  until  the  addressees  call  for  them. 


Achar-i8 

Artigas  (villa)-3 

Barra  Santa  Lucia-io 

B  a  tile  y  Ordonez-o, 

Canelones-2 

Carmelo-4 

Carmen-5 

Cerro-io 

Chuy-i4 

Colon-io 

Colonia-4 

Colonia  Valdense-4 

Conchillas'4 

Corrales-i3 

Cunapiru-i3 

Dolores-iy 

Durazno-5 

Florida-7 

Francia-i2 

Fray  Bentos-i2 

Fray,  Marcos-y 

Goni-7 

I  si  a  Cabellos-i 

Isla  de  Flores-io 

Isla  Mala-7 

Joaquin  Suarez-2 

La  Paz  (C.)-2 


Lascano-i4 

La  Sierra-8 

Las  Piedras  2 

Libertad-i6 

Maldonado-8 

Melo-3 

Mercedes-i7 

Merinos-i  2 

Migues-a 

Minas-9 

Montevideo-io 

Nueva  Helvecia-4 

Nueva  Palmira-4 

Ombues  de  Lavalle-4 

Palmitas-i7 

Pan  de  Azucar-8 

Pando-2 

Paso  del  Cerro-i8 

PasodelosToros-i8 

Paso  del  Molino-io 

Paysandu-i  i 

Pisarja-9 

Pocitos-io 

Pueblo  Porvenir-i  I 

Pueblo  Solis-p 

Punta  del  Esta-8 

Rivera-i3 


Rocha-i4 

Rodriguez-i6 

Rosario-4 

Saladero  Nuevo  Paysandu-i  i 

Salto-i5 

San  Carlos-8 

San  Eugenic- 1 

San  Fructuoso-i8 

San  Gregorio-i8 

San  Jose-i6 

San  Jacinto-2 

San  Ramon-2 

San  Vicente  de  Castillos-2 

Santa  Lucia-2 

Santa  Rosa  (C.)-2 

Santa  Rosa  (A.)-i 

Sarandi  Grande-7 

Sarandi  del  Yi-5 

Sauce  2 

Soriano-i7 

Tala-2 

Tranquera  (Paso  de  Ia)-i3 

Treinta  y  Tres-ip 

Trinidad-6 

Union-io 

Vergara-i9 

Zapacan-g 


La  Paz  (C.  P.)-4 

The  number  appearing  after  each  post  office  indicates  the  province  in  which 
located,  said  provinces  being:  i  Artigas,  2  Caneloenes,  3  Cerro  Largo,  4  Colonia, 
5  Durazno,  6  Flores,  7  Florida,  8  Maldonado,  9  Minas,  10  Montevideo,  n  Pay- 
sandu,  12  Rio  Negro,  13  Rivera,  14  Rocha,  15  Salto,  16  San  Jose,  17  Soriano,  18 
Tacuarembo,  19  Trienta  y  Tres. 

[78] 


PARCEL-POST 

Two  CERTIFICATES  of  origin,  in  Spanish,  are  required.  Merchandise 
under  parcel-post  shipments  is  subject  to  the  same  duties  as  are  im- 
posed on  freight  shipments.  Consular  invoices,  in  duplicate,  are  neces- 
sary on  packages  having  a  declared  value. 

Venezuela 

OBSERVATIONS. — Limit  of  weight  for  parcels,  n  pounds.  Four  copies  of  the  cus- 
tom declaration  (Form  2966)  must  be  attached  to  each  parcel.  If  any  person 
receives  more  than  20  kilograms  (44  pounds)  of  the  same  merchandise  by  the 
same  steamer,  he  must  pay,  in  addition  to  the  entry  duty,  an  amount  equal  to 
10  per  cent,  of  the  Venezuela  custom  tariff.  The  weight,  contents  and  value 
should  be  indicated  clearly  and  specifically,  instead  of  by  a  general  statement 
of  the  merchandise.  Violation  of  this  stipulation  involves  a  fine  of  twice  the 
amount  of  the  custom  duty  chargeable  on  the  parcel. 

PROHIBITIONS. — Starch,  indigo,  cocoa,  coffee;  salted  or  dry  meat  in  pieces;  salt; 
sarsaparilla  roots;  silver,  nickel  or  copper  coins  and  machines  for  the  manu- 
facture of  the  same;  matches,  except  those  known  as  "feu  de  Bengale;"  cigarette 
paper;  saccharine  and  its  products  unless  addressed  to  pharmacists,  who  may 
import  i  oo  grains  per  person. 

CONSIDERABLE  delay  is  occasioned  in  Venezuela  on  parcel-post  ship- 
ments. 

Notice  to  consignee  of  the  arrival  of  packages  by  this  medium  is 
by  publication,  after  which  consignee  is  obliged  to  notify  the  director 
of  the  post  office  of  his  acceptance  or  rejection  of  the  package.  After 
a  somewhat  protracted  delay,  extending  at  times  to  weeks,  the  post 
office  authorities  forward  to  consignee  a  statement  of  the  duties  and 
charges  assessed  upon  package,  upon"  payment  of  which  shipment  is 
released. 

PARCEL-POST  —  GENERAL    OBSERVATIONS 

1.  Address 

COMPLETE  name  and  address  of  the  consignee  should  be 
written  on  every  parcel. 

2.  Custom  Declaration 

WHERE  custom  declaration  is  required  by  the  postal  treaty, 
this  is  filled  out  on  a  special  tag  supplied  by  the  post  office,  which 
should  be  tied  to  the  package.  (Several  countries  do  not  require 
custom  declaration.) 

3.  Marks 

No  DISTINGUISHING  marks  are  necessary  on  the  parcels,  but 

[79] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

they  should  be  numbered  (i,  2,  3,  etc.),  in  the  case  of  shipment  of 
several  parcels  to  the  same  party. 

4.  Guarantee 

U.  S.  POST  OFFICE,  as  a  rule,  does  not  guarantee  delivery  of 
parcels  in  foreign  countries,  even  if  insured,  and  does  not  accept 
responsibility  for  loss  by  any  cause. 

It  is  safer  to  insure  parcels  against  loss  with  insurance  companies 
specializing  in  this  class  of  insurance. 

Drafts  in  Cover  J or  Parcel-Post  Shipments 

OWING  to  the  usual  and  expected  delay  of  from  two  to  six 
weeks  in  the  delivery  of  parcel-post  shipments  after  arrival  at  most 
South  American  post  offices,  foreign  consignees  usually  refuse  to 
"accept"  drafts  covering  such  shipments  until  after  definite  delivery 
to  them  of  the  corresponding  merchandise. 

On  this  account,  it  is  advisable  to  draw  drafts  covering  parcel-post 
shipments  "so  many  days  after  date,"  as  on  drafts  drawn  "so  many 
days  after  sight"  time  does  not  commence  to  run  in  some  countries 
until  the  date  of  actual  acceptance  by  drawee,  irrespective  of  the 
number  of  times  the  draft  may  have  been  presented  for  this  purpose. 

CABLES 

Time,  Tariff,  Codes 

SECURE  from  cable  companies  their  tariffs  covering  messages 
to  and  from  South  America.  Rates  run  as  high  as  $1.44  a  word,  so 
that  codes  will  be  found  economical.  Night  (or  deferred)  messages, 
if  in  plain  language,  and  if  sent  to  South  America  via  the  West 
Coast,  may  be  sent  generally  at  half  rates.  This  is  convenient  for 
Saturday  to  Monday  cables. 

Private  codes  may  also  be  compile^  for  use  between  the  home  office 
and  foreign  branches  or  representatives,  but  it  is  advisable  to  consult 
the  rules  of  cable  companies  in  this  respect. 

There  is  no  direct  cable  service  between  the  United  States  and 
Brazil,  and  messages  between  the  two  countries  are  transmitted  either 
via  Europe  or  via  the  West  Coast  of  South  America  through  Chile 
and  the  Argentine. 

Messages  between  the  two  countries  via  the  Argentine  and  the 
West  Coast  of  South  America  are  more  expensive  though  quicker. 

[80] 


FOREIGN  EXCHANGE 


It  will  be  noted  from  this  that  messages  between  the  United  States 
and  Brazil  cover  a  considerably  longer  transmission  distance  than 
do  cables  between  the  Argentine  or  Chile,  and  on  this  account  the 
cost  of  such  messages  is  higher. 

Messages  between  the  United  States  and  the  Argentine  or  the 
West  Coast  South  American  countries  pass  over  the  direct  lines  of 
the  Central  South  America  Cable  Company,  via  Colon. 


FOREIGN  EXCHANGE 


South  American  Monetary  Values 

HEREWITH  is  given  the  approximate  value,  in  American  money, 
of  the  moneys  in  circulation  in  the  different  countries  of  South 
America. 


COUNTRY 
Argentina .... 


Bolivia 
Brazil 


MONETARY 
UNIT 

Peso 

Paper  peso  in  cur- 
rent use 
Boliviano 
Milreis,  1,000  reis 


STANDARD 


Gold 

Paper 
Gold 
Gold 
Paper 


British  Guiana    Money  of  England 
Chile  Peso  Gold 

Paper 


Colombia 

Ecuador 

Panama 

Paraguay 

Paraguay 

Peru 

Uruguay 
Venezuela 


Peso 

Sucre 

Balboa 

Peso 

Peso  (Argentine) 

Peruvian  pound 

(10  soles) 
Peso 
Bolivar 


Gold  and  variable 

paper 
Gold 
Gold 
Silver 
Gold 

Gold 
Gold 
Gold 


EQUIVALENT 

U.    S.    VALUE 

$0.9648 


0.4245 

0-3893 
0.5462 
0.3244 

variable 

0.3650 

o.2433 

variable 

0-9733 
0.4867 

1. 00 

0.7105 
o . 9648 

4.8665 

1.034 

0.1930 


[81] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

THESE  values  are  mint  par.  The  commercial  values,  however,  fluctuate 
from  day  to  day  in  keeping  with  the  movement  of  imports  and  ex- 
ports and  the  consequent  demand  for  and  supply  of  exchange  in  the 
countries  involved,  thus  affecting  the  rates  on  the  various  countries. 

FOREIGN  WEIGHTS,  MEASURES  AND 
GENERAL  UNITS 

IN  quoting  prices  to  merchants  in  foreign  countries,  as  well  as  in 
filling  orders  received  from  abroad,  care  should  be  exercised  in 
interpreting  the  units  availed  of.  If  the  "ton"  should  be  used,  it 
should  be  noted  that  the  net  ton,  the  gross  ton,  and  the  metric  ton 
differ  in  weight.  "Hundred  weight,"  likewise,  could  mean  100  pounds 
or  112  pounds. 

Where  a  quotation  is  made  by  weight  or  by  ton,  it  is  advisable  to 
specify  the  number  of  pounds  intended  by  the  unit  of  weight  used; 
that  is,  a  "ton  of  2,000  pounds,"  "ton  of  2,240  pounds,"  or  "ton  of 
2,204  pounds."  The  carload  lot  may  likewise  vary  between  12,000 
and  90,000  pounds.  In  other  words,  in  order  to  avoid  misunderstand- 
ing it  is  advisable  in  quoting  to  render  clear  the  interpretation  to 
be  given  to  the  unit  used. 

On  orders  received  from  South  America  on  which  prices  have  not 
been  quoted,  and  in  which  the  units  of  weight  or  measure  used  may 
be  variously  interpreted,  it  is  policy,  if  in  doubt,  to  cable  before 
shipping,  and  await  confirmation  of  the  price  to  be  charged  and  the 
unit  equivalent  to  be  covered  thereby. 

METRIC    EQUIVALENTS    IN    WEIGHTS 
AND    MEASURES 

THE  METRIC  SYSTEM  is  obligatory  in  the  Argentine,  Bolivia,  Brazil, 
Chile,  Colombia,  Ecuador,  Paraguay,  Peru  and  Uruguay. 

PREFIXES  MEANING  UNIT 

milli   -one  thousandth  1/1000=         .001  meter  =  for  length 

centi  —one  hundredth  i/ioo   =         .01 

deci    -one  tenth  i/io     =         .1  gram  -weight  or  mass 

deka  -ten  10/1       =     10. 

hecto  -one  hundred  100/1       =  100.  liter    =  for  capacity 

kilo    -one  thousand  1000/1       =1000. 

[82] 


WEIGHTS,  MEASURES,  ETC. 


Metric  Weights 

Milligram  (i/iooo  gram)  =  0.0154  grain 

Centigram  (i/ioo  gram)  =  0.1543  grain 

Decigram  ( i /io  gram)  =  1.5432  grains 

Gram  =  15.432  grains 

Decagram  (io  grams)  =  0.3527  ounce 

Hectogram  (100  grams)  =  3-5274  ounces 

Kilogram  (1,000  grams)  =  2.2046  pounds 

Myriagram  (10,000  grams)  =  22.046  pounds 

Quintal  (100,000  grams)  =  220.46  pounds 

Millier  or  tonnea-ton  (1,000,000  grams)  =  2,204.6  pounds 

Equivalents 

2.2046  Avoirdupois  pounds  =»  I  kilogram 
2,000  Avoirdupois  pounds  =*  I  short  ton 

2,240  Avoirdupois  pounds  =  I  long  ton 

2,204.622    Avoirdupois  pounds  =  I  metric  ton 

FOR  the  purpose  of  figuring  weights  on  invoices,  kilos  may  be  figured 
at  2  1/5  pounds  to  the  kilo  or  kilogram.  (See  reduction  table  of 
pounds  to  kilos,  on  page  86.) 

Metric  Dry  Measures 

Milliliter  (i/iooo  liter)  =  0.06 1  cubic  inch 
Centiliter  (i/ioo  liter)  =  0.6102  cubic  inch 
Deciliter  (i/io  liter)  =  6.1022  cubic  inches 
Liter  =  0.908  quart 
Decaliter  (io  liters)  =  9.08  quarts 
Hectoliter  (100  liters)  =»  2.838  bushels 
Kiloliter  (1,000  liters)  =  1.308  cubic  yards 

Metric  Liquid  Measures 

Milliliter  (i/iooo  liter)  =  0.27  fluid  dram 

Centiliter  (i/ioo  liter)  =  0.338  fluid  ounce 

Deciliter  (i/io  liter)  =  0.845  &^ 

Liter  =  1.0567  quarts 

Decaliter  (io  liters)  =  2.6417  gallons 

Hectoliter  (100  liters)  =  26.417  gallons 

Kiloliter  (1,000  liters)  =  264.17  gallons 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Equivalents 

I  liquid  pint  =  0.473  liters 
i  liquid  quart  =  0.946  liters 
i  gallon  =  3.785  liters 

Metric  Measures  of  Length 

Millimeter  (i/iooo  meter)  =  0.0394  inch 

Centimeter  (i/ioo  meter).  =  0.3937  mcn 

Decimeter  (i/io  meter)  =  3.937  inches 

Meter  =  39.37  inches 

Decameter  (10  meters)  =  393-7  inches 

Hectometer  (100  meters)  =  328  feet  i  inch 

Kilometer  (1,000  meters)  =  0.62137  mile  (3,280  ft.  10  in.) 

Myriameter  (10,000  meters)  =  6.2137  miles 

Equivalents 

i  inch  =  1/36  yard  =  1/12  foot  =     100/3937  meter 
i  foot    =  1/3  yard    =  1200/3937  meter 

i  yard  =  36  inches    =  3600/3937  meter 

39  37/100  inches  (1.093  yards)  =  i  meter 

Metric  Surface  Measures 

Centare  (i  square  meter)  =  1,550  square  inches 
Arc  (100  square  meters)  =  119.6  square  yards 
Hectare  (10,000  square  meters)  =  2.471  acres 

Equivalents 

i  acre  =»      0.404  hectares 

i  square  mile  =  258.999  hectares 

Volume 

i  cubic  inch  =  16.387  cubic  centimeters 

i  cubic  foot  =    28,317.016  cubic  centimeters 

i  cubic  yard  =  764,559.4      cubic  centimeters 

1.3079  cubic  yards  =  i         cubic  meter 


[84] 


WEIGHTS,  MEASURES,  ETC. 


LOCAL    FOREIGN    WEIGHTS    AND    MEASURES 
AS  OFTEN  USED  ON  FOREIGN  ORDERS 

ARGENTINE    REPUBLIC 

Arroba  (dry) 25.3171  Ibs.  Libra 1.0127  Ibs. 

Baril 20.0787  gals.  Pie 0.9478  ft. 

Cuadra 4.2        acres  Quintal 101.42      Ibs. 

Frasco 2.5096  qts.  Vara 34.1208  ins. 

BOLIVIA 
Marc °-5°7  Ibs. 

BRAZIL 

Arroba  (dry) 32.38  Ibs.        Quintal 130.06  Ibs. 

CHILE 

Fanega  (dry) 2.575  bu.        Quintal 101.61    Ibs. 

Libra 1.014  Ibs.        Vara 33-3^7  ins. 

PARAGUAY 

Vara 34  ins.        Cuadra 78.9  yds. 

Quintal 100  Ibs.        Cuadra  (square) . . .  8,077     s(l-  ft- 

League  (land) 4*633  acres     Arobe 25     Ibs. 

PERU 

Libra 1.0143  Ibs.        Vara 33-36?    ins- 

Quintal 101.          Ibs. 

URUGUAY 

Cuadra nearly  2         acres     Libra  (pound)  .  .  .  1.0143  Ibs. 

Fanega  (dry)  .double  7.776  bu.         Suerte 2,700    cuadras 

Fanega  (dry)  .  single  3.888  bu.  (See  Cuadra) 

VENEZUELA 

Vara 33-382    ins.        Arroba  (liquid)  . .  4.263     gals. 

Libra  (pound) 1.0161  Ibs.        Arroba  (dry)  ....   25.4024  Ibs. 

Fanega  (dry) 1.599  bu. 

[85] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


REFERENCE    TABLE 
REDUCTION    OF    POUNDS    TO    KILOS 


I 

0-4535 

2 

.9070 

3 

1.3605 

4 

1.8140 

5 

2.2675 

6 

2.7210 

7 

3.I745 

8 

3.6280 

9 

4.0815 

10 

4.5350 

ii 

4.9885 

12 

5.4420 

13 

5.8955 

14 

6.3490 

IS 

6.8025 

16 

7.2560 

»7 

7.7095 

18 

8.1630 

19 

8.6165 

20 

9.0700 

21 

9.5235 

22 

9.9770 

23 

10.4305 

24 

10.8840 

25 

"•3375 

26 

11.7910 

27 

12.2445 

28 

12.6980 

29 

13.1515 

30 

13.6050 

34 
35 
36 


LBS.  KILOS 

31  14.0585 

32  14.5120 

33  H.9655 
15.4190 
15.8725 
16.3260 

37  16.7795 

38  17.2330 

39  17-6865 

40  18.1400 

41  18.5935 

42  19.0470 
19.5005 
19.9540 
20.4075 
20.8610 


61 
62 

63 
64 

65 
66 

67 
68 
69 
70 


KILOS 
27.6635 
28.1170 
28.5705 
29.0240 
29.4775 
29.9310 

30.3845 
30.8380 


43 


47 
48 
49 
50 
51 
52 
53 
54 

2 

57 
58 
59 
60 


21.7680 
22.2215 
22.6750 
23.1285 
23.5820 

24-0355 
24.4890 

24-9425 
25.3960 
25.8495 
26.3030 

26.7565 
27.2100 


3 ' -745° 
32.1985 
32.6520 
33-1055 
33.5590 

75  34-0125 

76  34.4660 

34.9*95 
350730 
35.8265 

80  36.2800 

8 1  36.7335 

82  37.1870 
37.6405 
38.0940 

38.5475 
39.0010 

39-4545 
39.9080 
40.3615 
40.8150 


72 
73 
74 
7f 

77 
78 
79 


83 
84 

85 
86 

87 
88 
89 
90 


LBS. 

KILOS 

91 

41.2685 

92 

41.7220 

93 

42.1755 

94 

42.6290 

95 

43.0825 

96 

43.5360 

97 

43.9895 

98 

44-443° 

99 

44.8965 

100 

45.3500 

200 

90.7000 

300 

136.0500 

400 

181.4000 

500 

226.7500 

600 

272.1000 

700 

217.4500 

800 

362.8000 

900 

408.1500 

i  ,000 

453.5000 

2,000 

907. 

3,000 

1,360.5000 

4,000 

1,814. 

5,000 

2,267.5000 

6,000 

2,721. 

7,000 

3,174.5000 

8,000 

3,628. 

9,000 

4,081.5000 

10,000 

4,535. 

20,000 

9,070. 

30,000 

13,605. 

REPRESENTATIVES  OR  SALESMEN 

CARE  TO  BE  OBSERVED  IN  THEIR  SELECTION 

HAVE  the  man  whom  you  intend  to  send  to  a  foreign  country 
study  the  language  of  that  country.  This  is  better  for  him,  for 
the  firm  he  represents,  and  for  those  in  the  foreign  country  with  whom 
he  will  be  treating.  It  is  not  an  exaggeration  to  say  that  for  every  dollar's 
worth  of  business  developed  by  a  representative  while  unable  to  speak 
the  language  of  the  country,  two  dollars'  worth  could  have  been  se- 
cured if  the  business,  instead  of  being  transacted  through  the  medium 
of  an  interpreter,  could  have  been  carried  on  direct  with  the  purchaser 
in  his  own  language.  However,  as  between  a  representative  thor- 
oughly familiar  with  the  business  to  be  transacted,  though  unfamiliar 
with  the  language  of  the  country,  and  one  who  speaks  the  language 
but  is  not  familiar  with  the  line  of  business  to  be  represented,  the 

[86] 


SALESMEN'S  LICENSES 


former  is  by  all  means  preferable.  This  is  an  important  point  to  be 
borne  in  mind  by  American  merchants  interested  in  developing  a 
South  American  trade. 

A  combination  of  these  advantages,  however,  will  mean  smoother 
sailing  in  a  foreign  country,  as  anyone  who  has  ever  tried  to  transact 
business  through  the  medium  of  an  interpreter  knows  but  too  well 
how  exceedingly  embarrassing  and  unsatisfactory  it  is  to  all  con- 
cerned. 

SALESMEN'S  LICENSES  IN  SOUTH  AMERICA 

THE  information  under  this  heading  is  of  special  interest  to 
firms  contemplating  the  sending  to  South  America  of  a  repre- 
sentative or  salesman. 

A  peculiarity  in  connection  with  the  special  tax  imposed  is  that 
the  government  tax  is  frequently  supplemented  by  a  particular  pro- 
vincial tax  imposed  by  the  province  in  which  business  is  solicited  or 
effected. 

Under  the  heading  devoted  to  "Samples"  it  will  be  noted  that 
samples  to  be  admitted  free  are  occasionally  subjected  to  mutilation 
though  such  mutilation  is  not  sufficiently  severe  to  effect  the  purpose 
for  which  the  sample  is  supposedly  to  be  used.  Shoe  salesmen  on  this 
account  usually  carry  but  one  sample  shoe  of  a  pair. 

Argentina 

IN  THE  city  of  Buenos  Aires,  and  in  the  ten  national  terri- 
tories of  the  country,  a  tax  for  the  transaction  of  business  ranging 
from  500  to  5,000  Argentine  pesos  is  imposed  upon  representatives 
of  foreign  houses.  In  the  fourteen  provinces  the  annual  tax  varies 
from  600  to  800  Argentine  pesos  for  each  province. 

If  a  representative  visits  the  Argentine  simply  with  a  view  to  ap- 
pointing agents,  no  tax  is  imposed.  If  he  has  with  him  catalogues  or 
samples  and  endeavors  to  take  orders,  this  activity  brings  him  within 
the  imposition  of  the  tax.  An  exact  transcript  in  English  of  the  Argen- 
tine law  in  this  connection  reads: 

"Representatives  of  foreign  firms  with  or  without  stores  opened  to  the  public, 
or  brokers  or  commission  merchants  from  abroad,  shall  pay  an  annual  license 
of  500  to  5,000  Argentine  pesos.  Representatives,  commission  merchants  or 
traveling  salesmen  from  abroad  who  are  not  members  of  a  firm  established  in 
Buenos  Aires  or  in  the  national  territories  may  not  transact  business  except 
upon  payment  in  advance  of  the  Government  license  fee." 

[87] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


The  taxes  imposed  in  the  provinces  and  territories  are  separately 
payable.  These  taxes  cannot  be  paid  in  one  sum  at  the  Government 
bureau  in  Buenos  Aires;  they  become  due  and  are  individually  pay- 
able in  the  territories  and  provinces  upon  commencing  activities 
therein. 

Bolivia 

SALESMEN  or  representatives  of  foreign  houses  transacting 
business  in  Bolivia,  whether  carrying  samples  or  not,  are  subject  to 
local  taxation  in  the  various  cities  of  the  republic.  This  ranges  from 
ico  Bolivianos  to  250  Bolivianos  in  each  city. 

Brazil 

REPRESENTATIVES  visiting  Brazil  for  the  purpose  of  appoint- 
ing agents  are  not  subject  to  any  tax,  federal,  state  or  municipal. 

A  salesman  selling  merchandise,  whether  from  sample  or  without 
sample,  is  subject  to  municipal  and  state  taxes.  The  law  in  this  re- 
spect, however,  is  somewhat  lax,  so  that  if  an  office  is  not  opened 
there  is  little  probability  of  tax  being  collected.  There  is  no  tax  levied 
by  the  Federal  Government  on  foreign  salesmen  transacting  business 
in  Brazil,  but  salesmen  traveling  from  state  to  state  in  Brazil  are 
subject  to  the  taxes  of  the  various  states.  This  tax  varies  with  the 
class  of  goods  sold. 

A  foreign  salesman,  agent,  or  representative  of  a  foreign  concern 
\/ho  has  established  a  permanent  office  or  show  room,  whether  carry- 
ing stock  or  not,  must  transact  business  in  his  own  name  and  not 
in  the  name  of  the  firm  he  represents,  although  he  may  advertise 
or  represent  himself  as  the  agent  of  his  principals.  All  taxes,  how- 
ever, must  be  paid  in  his  individual  name.  These  taxes  are  as  follows: 

STATE  TAX. — This  varies  with  the  nature  of  the  business  trans- 
acted, and  increases  proportionately  with  the  amount  of  capital  in- 
vested in  the  stock  carried. 

FEDERAL  TAX. — This  varies  with  the  nature  of  the  business,  and 
increases  in  proportion  to  the  amount  of  rent  paid  for  the  premises 
occupied.  In  the  city  of  Rio,  the  municipal  tax  is  10%  of  the  rental 
value  of  the  office  occupied. 

When  traveling  in  the  interior,  taxes  for  transacting  business  are 
separately  imposed  and  are  due  to  the  various  municipalities  in  which 
it  is  desired  to  transact  business.  Where  it  is  desired  to  avoid  these 

[88] 


SALESMEN'S  LICENSES 


impositions  it  is  advisable  in  traveling  to  carry  to  each  city  only 
the  samples  it  is  intended  to  use,  either  leaving  the  others  behind  to 
be  packed  up  later  on  or  forward  them  ahead  to  the  point  at  which 
they  are  to  be  used. 

Chile 

A  REPRESENTATIVE  visiting  Chile  simply  to  appoint  agents 
does  not  come  within  the  imposition  of  the  commercial  tax.  If  he 
endeavors  to  sell,  however,  either  from  sample  or  catalogue,  this  ac- 
tivity brings  him  within  the  imposition  of  the  tax,  which  ranges 
from  $1,000  to  $3,000  pesos  paper  for  each  of  the  twenty-four  prov- 
inces of  the  country. 

A  traveler,  however,  would  visit  only  three  or  four  of  these  prov- 
inces, as  the  others  are  not  of  sufficient  importance  to  warrant  an 
endeavor  to  develop  business  therein. 

The  penalty  inflicted  upon  conviction  of  endeavoring  to  avoid  pay- 
ment is  a  fine  of  three  times  the  legal  tax. 

Colombia 

IF  A  REPRESENTATIVE  visit  Colombia  simply  to  appoint  agents, 
he  does  not  come  within  the  imposition  of  tax.  If  he  sells,  however, 
or  endeavors  to  sell,  whether  he  has  with  him  samples  or  not,  tax 
is  imposed  and  this  amounts  to  approximately  $20  gold  monthly, 

Ecuador 

A  REPRESENTATIVE  visiting  the  country  simply  to  appoint 
agents  is  not  subject  to  tax.  If  it  be  the  intention  to  take  orders,  the 
samples  coming  through  the  custom  will  not  be  released  until  pay- 
ment of  a  tax  of  ico  sucres  (a  sucre  is  approximately  48  cents  American 
money).  This  is  not  a  duty  on  the  samples  but  a  tax  for  the  sale  of 
merchandise  in  the  country.  Passports  of  all  travelers  entering  Ecua- 
dor must  be  exhibited  to  the  authorities  within  twenty-four  hours 
after  entering  the  country. 

Paraguay 

THERE  is  no  tax  on  salesmen  or  representatives  transacting 
business  in  Paraguay. 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Peru 

IN  PERU  there  is  no  national  tax  covering  the  activities  of  com- 
mercial travelers.  However,  local  taxes  are  imposed  in  some  of  the 
smaller  towns  and  districts.  In  Arequipa  this  tax  is  25  soles  quarterly. 
In  Cuzco  the  tax  is  50  soles  for  each  visit. 

Uruguay 

No  TAX  is  imposed  in  Uruguay  on  salesmen  or  representatives 
of  foreign  houses  whether  samples  are  carried  or  not,  unless  actual 
delivery  of  the  merchandise  sold  is  made  by  the  salesman.  In  this 
event  the  tax  per  annum  is  $100.00  gold. 

Venezuela 

THERE  are  no  special  taxes  or  regulations  governing  the  activi- 
ties in  Venezuela  of  salesmen  or  representatives  of  foreign  houses  irre- 
spective of  whether  they  sell  from  catalogue  or  samples. 

SAMPLES 

RULES    GOVERNING    CUSTOM    ENTRY   IN 

SOUTH    AMERICAN    COUNTRIES 
Argentina 

IF  IT  be  intended  to  re-export  samples  within  six  months  after 
entry  into  the  Argentine  it  is  possible  to  avoid  payment  of  duties  by 
placing  with  the  custom  authorities  an  acceptable  bond  under  which 
the  guarantor  becomes  liable  for  the  duties  and  a  fine  in  addition 
thereto  in  the  event  that  an  extension  has  not  been  secured  or  that 
re-export  has  not  been  effected  within  the  time  specified. 

Where  samples  may  be  mutilated  without  destroying  their  effective- 
ness as  specimens  this  method  is  resorted  to  where  it  is  desired  to 
avoid  the  payment  of  duties.  Shoes  may  have  the  soles  perforated  or 
the  uppers  cut.  Carpets  or  rugs  may  be  cut  into  small  sections,  etc., 
and  still  serve  the  purpose  of  samples.  With  expensive  merchandise 
samples,  the  salability  of  which  would  be  destroyed  through  mutila- 
tion, in  the  absence  of  the  bond  required,  it  is  advisable  to  pay  the 
duties  and  dispose  of  the  merchandise  after  the  sample  has  served  its 
purpose. 

[90] 


SAMPLES 


Bolivia 

To  ENTER  samples  through  the  custom  house  in  Bolivia  it  is 
necessary  to  make  declaration  to  the  effect  that  the  merchandise 
entered  is  to  be  used  solely  for  the  purpose  of  serving  as  sample.  No 
duty  is  collected  if  the  appraised  value  of  such  merchandise  is  10 
Bolivianos  or  less.  On  values  in  excess  of  this  amount  duties  must  be 
paid  or  such  samples  must  be  so  mutilated  so  as  to  render  them  un- 
salable. 

On  samples  or  merchandise  which  it  is  intended  to  re-export  the 
guarantee  or  bond  of  a  reputable  bank  or  business  house  is  required  to 
cover  the  amount  of  duties  which  such  merchandise  should  pay  were 
it  to  remain  in  the  country. 

Brazil 

SALESMEN'S  samples  as  such  are  not  subject  to  a  tax,  but  if 
salable  they  are  subject  to  the  ordinary  custom  duties.  Samples  car- 
ried should  be  covered  by  a  Consular  invoice  issued  by  a  Brazilian 
Consul  in  this  country,  containing  a  description  of  the  articles  carried 
as  samples.  With  this  document  salesmen  will  pay  full  duties  on  sam- 
ples carried,  but  with  the  understanding  that  refund  will  be  made 
upon  re-exportation.  A  bond,  however,  is  required  by  the  authorities 
from  an  acceptable  firm  or  bank  in  Brazil  before  samples  can  be  cleared 
on  this  basis.  Samples  cleared  in  this  manner  are  subject  to  5%  of 
their  official  value  and  are  likewise  subject  to  the  following  additional 
charges:  such  as  Port  works  tax  and  storage,  handling  and  statistical 
charges  so  that  refund,  if  made  later  on,  will  be  for  only  one-third  to 
one-half  of  the  duties  originally  paid. 

Unless  re-export  of  samples  is  effected  within  60  days  the  refund 
privilege  is  cancelled.  An  extension  of  this  time,  however,  may  be 
secured  upon  application  to  the  Collector  of  the  Port.  In  practice, 
samples  are  rarely  removed  under  bond.  Salesmen  usually  pay  full 
duties  in  order  to  avoid  annoyance. 

Chile 

PAYMENT  of  duties  on  samples  may  be  avoided  if  objection  to 
mutilation  is  not  made.  A  Consular  invoice  is  necessary  covering  sam- 
ples carried.  If  samples  are  to  be  re-exported  the  payment  of  duties 
may  be  avoided  by  placing  an  acceptable  bond  with  the  custom  house 

[91] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

authorities  under  which  guarantor  becomes  obligated  to  pay  the  du- 
ties if  the  goods  are  not  removed  from  the  country  within  six  months. 

Ecuador 

To  AVOID  payment  of  duty  on  samples  a  guarantee  acceptable 
to  the  government  must  be  deposited  with  the  custom  authorities 
covering  the  re-exportation  of  such  samples  within  a  stipulated  period. 
At  the  expiration  of  this  period  if  the  samples  have  not  been  re-ex- 
ported the  corresponding  duties  must  be  paid  under  the  guarantee. 

Paraguay 

SAMPLES  may  be  cleared  through  the  Paraguayan  custom  duty 
free  if  declared  as  of  no  commercial  value. 

Peru 

IN  CONNECTION  with  the  entering  of  samples  through  the  cus- 
tom house  at  Lima  it  is  necessary  to  present  to  the  collector  an 
itemized  statement  containing  the  following  data: 

The  marks,  numbers,  net  and  gross  weight  and  dimensions  of  each 
package  with  the  detailed  contents  thereof.  As  samples,  only  one  ar- 
ticle of  each  kind,  quality,  shape,  size,  color  or  weight  may  be  im- 
ported, with  the  exception  of  such  articles  as  are  not  dutiable  under 
the  customs  tariff. 

On  samples  which  may  be  entered  free  of  duty  it  is  necessary  to 
deposit  with  the  collector  in  the  form  of  a  bank  draft  the  amount  of 
the  duties  which  would  be  imposed  if  the  merchandise  had  not  come 
through  as  samples.  This  amount,  however,  will  be  refunded  less 
accrued  charges  upon  re-exportation  if  effected  within  three  months 
from  date  of  en  try. 

Uruguay 

SAMPLES  may  be  entered  duty  free  if  at  the  time  of  entry  a 
declaration  is  made  through  a  custom  house  broker  to  the  effect  that 
re-exportation  will  take  place  within  ninety  days.  Samples  remaining 
in  the  country  after  the  expiration  of  this  period  incur  full  duties 
although  an  extension  of  the  ninety-day  period  may  be  obtained  if 
application  therefore  is  made  through  the  Collector  of  the  Port. 

The  payment  of  tax  on  samples  may  also  be  avoided  in  Uruguay  by 
permitting  the  custom  authorities  to  mutilate  samples  in  such  manner 
as  to  render  them  unsalable. 

[92] 


BRANCH  OFFICES 


Venezuela 

SAMPLES  to  the  extent  of  25  kilos  in  weight  may  be  entered  free 
through  the  Venezuelan  custom.  On  samples  in  excess  of  this  weight 
duties  are  assessed.  Such  duties,  however,  are  returnable  within  one 
year  if  in  the  interim  samples  have  been  re-exported  and  if  upon 
original  entry,  notice  was  given  of  the  intention  to  re-export. 

BRANCH  OFFICES  OF  AMERICAN  COMPANIES 

REQUIREMENTS    IN    SOUTH    AMERICA 
Argentina 

THE  DOMESTICATION  in  the  Argentine  of  a  foreign  company  or 
partnership  may  be  effected  in  three  different  ways: 

[  i  ]  By  delegation  of  authority  through  a  "Power  of  Attorney"  duly 
vis6ed  by  the  Argentine  Consul  in  the  American  city  of  issue. 

[2]  Establishing  a  branch  for  the  conduct  of  business  under  its  orig- 
inal by-laws  through  petition  for  this  purpose  to  the  Argentine 
National  Tribunal. 

[3]  The  organization  of  a  local  Argentine  corporation  or  partnership 
for  the  full  amount  of  the  capital  to  be  invested. 

The  cost  involved  in  the  drawing  of  the  necessary  papers  for  the 
average  corporation  or  partnership  is  around  2500  pesos  made  up  as 
follows : 

Legal  service .     .     .     $1,000  Argentine  paper 
Notary  fees   .      .      .     $1,000 
Publication  in  daily  papers  for  15  days 

$500  Argentine  paper 
Brazil 

FOR  THE  purpose  of  obtaining  authorization  to  operate  in 
Brazil  as  a  branch  of  an  American  corporation  or  firm  the  following 
documents  are  necessary: 

[  i  ]  Copy  of  the  charter  of  the  corporation  in  the  United  States. 
[2]  Copy  of  the  by-laws  of  the  corporation  in  the  United  States. 

Original  act  of  incorporation  showing  the  list  of  original  sub- 
scribers and  the  number  of  shares  held  by  each. 

[93] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

[4]  Special  power  of  attorney  of  the  corporation  in  the  United  States 
to  petition  authorization  to  operate  in  Brazil.  It  is  also  necessary 
to  signify  acquiescence  in  any  changes  which  may  be  proposed  to 
be  made  in  the  by-laws  in  order  to  conform  to  Brazilian  require- 
ments. 

[5}  General  power  of  attorney  of  the  corporation  in  the  United  States 
granting  full  powers  to  the  Brazilian  office  as  representative  of 
the  foreign  corporation.  This  should  be  in  duplicate. 

[6]  Certificate  of  resolution  of  the  Board  of  Directors  in  the  United 
States  authorizing  operations  in  Brazil  and  indicating  the  amount 
of  capital  to  be  employed  in  Brazil.  It  is  important  that  this 
document  specifically  state  the  capital  to  be  employed  in  Brazil, 
as  otherwise  assessment  by  the  Brazilian  authorities  will  be  upon 
the  entire  capital  of  the  corporation  in  the  United  States. 

It  is  suggested  that  in  the  event  of  it  being  desired  to  operate  in  Brazil 
with  a  capital  smaller  than  that  employed  in  the  United  States  it  is 
advisable  to  form  a  separate  Brazilian  corporation.  For  the  domestica- 
tion in  Brazil  of  such  an  incorporation  it  is  necessary  to  furnish  docu- 
ments similar  to  those  already  referred  to  with  the  exception  of  No.  6, 
the  Certificate  of  Special  Resolution,  which  may  be  dispensed  with 
when  the  articles  of  incorporation  expressly  provide  for  operations  in 
Brazil  on  the  basis  of  the  total  capital  liability. 

All  documents  referred  to  herein  to  have  legal  effect  in  Brazil  must 
be  visaed  by  a  Brazilian  Consular  officer  in  the  United  States. 

Translations  of  such  documents  from  English  into  Portuguese  had 
better  be  left  to  be  made  in  Brazil  by  a  sworn  public  translator,  inas- 
much as  translation  when  so  made  is  fully  protected  by  Brazilian  law. 

Where  only  a  branch  office  is  opened  in  Brazil  there  is  no  legal  re- 
quirement governing  the  necessity  of  such  office  being  in  charge  of  an 
officer,  a  director  or  stockholder  of  the  firm.  The  representative,  how- 
ever, should  be  clothed  with  full  and  complete  powers  to  adjust  all 
questions  arising  out  of  the  corporation's  activity  in  the  country. 

The  expenses  for  initiating  operations  in  Brazil  are  as  follows: 

£  I  ]  Stamp  tax  for  Decree  of  Authorization  Rs.  300^000 

[2]  Stamp  tax  on  capital  authorized  for  operations  in  Brazil,  at  the 
rate  of  2$ooo  per  conto  of  reis  (one  thousand  milreis)  or  fraction 

[94] 


BRANCH  OFFICES 


thereof,  exchange  to  be  made  at  the  official  rate  as  established 
by  the  official  Board  of  Brokers. 

[3]  Federal  Government  Tax — This  tax  varies: 

(a)  Fixed  tax  on  the  nature  and  class  of  business  or  profession, 
ranging  from  20^000  to  i6o$ooo. 

(b)  Proportional  tax  of  20%,  10%  or  5%  based  upon  the  an- 
nual rental  of  the  place  of  business,  as  also  the  class  of 
business  conducted. 

(c)  Income  tax  of  5%  on  declared  dividends. 

Domesticated  foreign  corporations  are  also  subject  to  the  Municipal 
License  Tax  of  the  Federal  District,  which  is  levied  on  the  amount  of 
the  capital. 

There  must  be  deposited  in  the  Bank  of  Brazil  (the  government 
institution)  pending  the  registration  of  the  decree,  one-tenth  part  of 
the  capital  to  be  devoted  to  Brazilian  business.  This  deposit  is  rarely 
retained  beyond  a  month's  time. 

The  petition  for  authorization  to  transact  business  in  Brazil  covers 
the  several  states  and  involves  no  additional  expense  for  the  establish- 
ing of  branches  outside  of  the  state  in  which  the  business  is  originally 
organized. 

Chile 

FOR  AN  AMERICAN  company  to  establish  a  branch  office  or 
agency  in  Chile  it  is  necessary  to  secure  governmental  authorization. 
The  steps  necessary  in  this  respect  are  to  file  in  the  commercial  reg- 
ister in  the  principal  city  of  the  country: 

[  i  ]  A  copy  of  the  by-laws  of  the  company  with  a  certificate  as  to  its 
legal  constitution  in  the  United  States,  these  documents  to  be 
viseed  by  a  Chilean  Consul  resident  in  the  United  States. 

[2]  Power  of  Attorney  granted  by  the  company  to  its  agent  or  repre- 
sentative in  the  South  American  country.  In  this  document  the 
company  assumes  full  responsibility  for  the  acts  in  the  foreign 
country  of  its  representative  so  appointed  and  authorizes  said 
representative  to  sue  or  be  sued  in  the  name  of  the  company. 

[3]  Statement  as  to  the  amount  of  contributions  to  the  company  by 
its  shareholders. 

[95] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

[4]  Vis6ed  copy  of  the  last  balance  sheet  of  the  company. 

In  the  general  application  should  likewise  be  included  documents  to 
the  effect  that  the  new  company  in  its  activities  in  Chile  will  be  subject: 

[  i  ]  To  the  administrative  and  judicial  authority  of  the  foreign  coun- 
try and  that  the  soliciting  company  renounces  diplomatic  pro- 
tection in  all  transactions  within  the  scope  of  the  company's 
operations  while  carried  on  in  Chile. 

[2]  That  the  property  of  the  company  owned  or  to  be  secured  in 
Chile  will  be  subject  to  the  laws  of  the  country  for  the  fulfilment 
of  its  obligations. 

[3]  That  notification  will  be  given  to  the  proper  authorities  of  any 
vital  change  in  the  company,  or  its  capital,  assets,  or  the  business 
to  be  transacted. 

[4]  That  the  reserve  fund  of  the  company  will  be  at  no  time  less  than 
25%  of  the  declared  capital  and  will  be  formed  by  at  least  5%  of 
the  net  profits  of  each  balance  and  that  this  fund  will  be  invested 
in  Chile. 

[5]  That  in  the  event  of  a  loss  of  50%  of  the  capital  the  company 
will  be  liquidated. 

[6}  That  the  home  company  will  forward  periodically  to  the  agent 
for  deposit  with  the  proper  Chilean  authorities  a  duly  viseed 
copy  of  its  periodic  balances. 

[7]  That  such  home  office  balance  will  be  published  in  an  official 
Chilean  paper. 

[8]  That  in  any  matters  brought  to  the  attention  of  the  Chilean 
authorities,  the  foreign  company  will  submit  in  like  manner  as 
a  local  company  to  the  decision  rendered. 

[9]  To  declare  the  amount  of  the  capital  to  be  assigned  to  the  busi- 
ness conducted  in  Chile  with  the  date  and  manner  in  which  such 
capital  is  to  come  into  the  country. 

Foreign  stock  companies  transacting  business  in  Chile  through  legally 
established  offices  are  subject  to  Government  inspection.  Of  the  capital 
to  be  placed  at  the  disposal  of  the  Chilean  branch  at  least  33^%  must 

[96] 


BRANCH  OFFICES 


be  deposited  with  the  Government  Depositary  before  consideration 
will  be  given  to  application  for  permission  to  transact  business. 

Taxes  vary  in  the  different  states.  Lines  of  business  are  usually 
classified  and  yearly  licenses  are  granted  by  special  commissions  after 
consideration  of  the  capital  invested  in  the  country  and  the  impor- 
tance of  the  class  of  business  transacted.  In  Chile,  municipal  taxes 
on  importing  houses  are  classed  as  follows: 

First  class  .  .  .  $6,000.00  pesos  annually 
Second  class  .  .  3,000.00  pesos  annually 
Third  class  .  .  .  2,000.00  pesos  annually 
Fourth  class  .  .  1,000.00  pesos  annually 
Colombia 

To  OPEN  in  Colombia  a  branch  office  of  an  American  firm  it  is 
necessary  to  file  with  the  commercial  registrar  a  copy  of  the  articles 
of  incorporation  or  partnership  agreement. 

Whether  or  not  stock  or  samples  are  carried  tax  must  be  paid,  based 
upon  the  nature  and  extent  of  the  business  to  be  transacted.  The  min- 
imum fee  being  $20  U.  S.  monthly. 

Bolivia — Ecuador — Paraguay 

THERE  are  no  special  requirements  in  these  countries  for  the 
establishment  of  a  branch  office  of  an  American  firm  beyond  furnishing 
the  manager  thereof  with  a  duly  viseed  Power  of  Attorney  and  pub- 
lishing with  the  local  press  the  articles  of  incorporation  or  partnership. 
These  requirements  are  necessary  irrespective  of  whether  stock  or 
samples  are  carried. 

Municipal  and  state  taxes,  however,  must  be  paid,  as  imposed  on 
all  local  business. 

Peru 

To  TRANSACT  business  in  Peru  a  branch  office  of  an  American 
firm  should  deposit  with  the  mercantile  registrar  a  certificate  viseed 
by  a  Peruvian  Consul  in  the  United  States  attesting  to  the  fact  that 
the  company  has  been  legally  organized  under  the  laws  of  the  United 
States  or  of  one  of  the  states  and  this  should  be  accompanied  with  a 
copy  of  its  constitution  and  by-laws  likewise  viseed  by  a  Peruvian 
Consul. 

There  should  also  be  registered  in  Peru  in  the  mercantile  register 
the  power  granted  to  the  manager  and  other  officers  in  Peru  detailing 

[97] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

the  powers  conferred.  The  incorporation  of  a  foreign  company  in 
Peru  is  subject  to  a  registry  tax  of  M%  upon  its  capital  stock  payable 
at  the  time  of  registry.  To  avoid  payment  of  a  tax  upon  the  entire 
capital  stock  of  a  foreign  corporation  it  is  advisable  that  a  smaller 
capital  be  assigned  to  the  Peruvian  branch.  A  municipal  tax  is  payable 
upon  the  opening  of  a  branch  house,  varying  in  amount  but  not  ex- 
ceeding £100  Peruvian.  This  tax  is  payable  once  only,  not  yearly.  A 
tax  of  5%  is  likewise  imposed  on  yearly  profits.  This  taxation  is  not 
affected  by  the  carrying  or  non-carrying  of  stocks.  Many  branch 
offices  in  Peru  are  not  paying  these  taxes  as  the  government  appears  to 
be  somewhat  lenient  in  this  respect,  but  should  any  litigation  arise 
such  offices  would  be  denied  legal  recognition  in  the  Peruvian  courts. 

Uruguay 

AMERICAN  firms  may  open  branch  offices  in  Uruguay  by  simply 
paying  the  tax  imposed  for  transacting  business  in  the  republic.  The 
tax  is  levied  whether  or  not  stock  or  samples  are  carried  and  is  based 
upon  the  nature  and  the  estimated  extent  of  the  business  to  be  trans- 
acted. 

Venezuela 

THE  ESTABLISHMENT  in  Venezuela  of  a  branch  office  of  an 
American  firm  requires  registration  in  the  commercial  register  and  a 
vis6ed  copy  of  the  original  articles  of  incorporation  or  partnership. 
These  articles  must  likewise  be  published  in  a  local  paper.  Delegation 
by  power  to  the  Venezuela  manager  thereof  of  authority  to  sue  and 
to  be  sued  in  the  name  of  the  company  is  likewise  necessary. 

The  cost  of  registration  usually  involves  a  charge  of  8  Bolivars  per 
page  for  the  translation  of  the  by-laws  and  other  necessary  documents, 
if  in  English,  and  such  translation  is  written  on  stamped  paper  at  i 
Bolivar  per  page. 

Powers  of  Attorney  are  written  on  stamped  paper  at  2  Bolivars  per 
page. 

Registration 7  Bolivars 

Publication      .      .      .      .     75  to  100  Bolivars 
Legal  fees 1,000  Bolivars 

A  municipal  tax  is  likewise  imposed  varying  with  the  class  of  mer- 
chandise to  be  sold  or  the  business  to  be  transacted. 

[98] 


RUBRICATION — LETTERS  OF  CREDIT 


RUBRICATION  OF  BOOKS  OF  ACCOUNT 
IN  FOREIGN  BRANCH  OFFICES 

USUALLY  the  principal  books  of  account  are  subject  in  South 
American  countries  to  rubrication  or  legalization,  for  which 
purpose  it  is  necessary  to  send  such  books  to  the  proper  Government 
Department.  Every  page  of  these  books  is  stamped  with  the  seal  of 
the  department  at  so  much  per  page. 

Failure  to  rubricate  such  books  estops  a  firm  from  using  as  legal 
evidence  whatever  information  they  may  contain  and  which  it  may  be 
desired  to  introduce  as  evidence  in  a  court  of  law. 


LETTERS  OF  CREDIT  AND  TRAVELERS'  CHECKS 

\ MERICANS  visiting  South  America  and  our  South  American 
±\.  friends  when  visiting  the  United  States  will  find  The  National 
City  Bank  Travelers'  Letters  of  Credit  a  safe  and  convenient  means  of 
carrying  funds. 

While  traveling,  it  is  dangerous  from  the  standpoint  of  possible 
robbery  or  loss,  to  carry  a  considerable  amount  of  money  on  one's 
person.  Through  the  Letter  of  Credit  this  danger  is  minimized,  as 
only  such  amounts  need  be  drawn  in  the  country  visited  as  may  be 
necessary  for  immediate  expenses.  The  protection  offered  by  this 
means  of  carrying  funds  is  considerable,  as  only  the  beneficiary  of  the 
Letter  may  obtain  money  thereunder  and  then  only  after  due  identi- 
fication. 

The  National  City  Bank  Travelers'  Checks  may  also  be  used  for 
foreign  travel.  These  checks  offer  considerable  protection  to  the  holder 
as  they  can  be  cashed  only  when  countersigned  in  the  presence  of 
the  payor  by  the  original  purchaser. 

The  Letter  of  Credit,  however,  gives  a  greater  measure  of  protec- 
tion. The  cost  of  either  National  City  Bank  checks,  good  the  world 
over,  or  of  National  City  Bank  Travelers'  Letters  of  Credit  is 
moderate. 

The  National  City  Bank  of  New  York  issues  Commercial  and 
Travelers'  Letters  of  Credit  from  its  New  York  office  as  also  from  its 
branch  banks  in  South  America,  covering  the  various  countries  of  the 
world. 

[99] 


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Sao  Paulo  Branch 
The  National  City  Bank  of  New  York 


TRAVEL  TO  AND  IN  SOUTH  AMERICA 


LETTERS  OF  INTRODUCTION 
TO  SOUTH  AMERICA 

IT  IS  advisable  when  visiting  South  America  to  carry  letters  of 
introduction  to  our  Branch  Managers.  Through  this  medium  the 
extensive  facilities  offered  by  our  branch  banks  in  practically  all  South 
American  countries  may  be  availed  of  by  the  traveling  representatives 
of  American  houses. 

In  connection  with  the  business  of  American  firms  passing  through 
our  foreign  branches,  however,  it  should  be  remembered  that  unless 
such  introductory  letter,  or  preferably  a  separate  power  of  attorney, 
specifically  confers  full  and  ample  authority  on  the  holder,  the  mere 
possession  of  an  introductory  letter  does  not  in  itself  warrant  recogni- 
tion on  the  part  of  our  foreign  banks  of  all  of  the  powers  which  travel- 
ing representatives  may  claim  to  possess. 

Among  the  general  powers  conferred,  those  to  which  special  atten- 
tion should  be  given  are  the  following: 

Authority  to  allow  reduction  or  rebate  on  drafts  of  the  home 
company  drawn  upon  foreign  clients. 

To  extend  time  on  drafts. 

To  waive  charges,  such  as  interest,  insurance,  etc. 

To  allow  inspection  of  the  merchandise  before  payment  or  ac- 
ceptance of  drafts. 

To  personally  take  up  documents  or  to  order  their  delivery  to 
another  person  or  firm. 

To  order  re-sale  or  re-shipment  of  merchandise. 

Other  powers  which  it  may  be  advisable  to  confer. 

The  exercise  of  care  in  delegating  through  a  proper  instrument  the 
exact  powers  which  it  is  intended  to  confer  will  save  considerable 
annoyance,  time  and  expense,  and  will  greatly  facilitate  the  activities 
of  American  representatives  traveling  in  South  America. 

TRAVEL  TO  AND  IN  SOUTH  AMERICA 

AT  THE  time  of  writing  the  rates  for  South  American  steamship 
travel  are  excessive.  The  minimum  first  class  rates  as  given  here- 
in are  those  obtaining  at  the  present  time  and  while  subject  to  wide 
and  sudden  variation,  they  will  serve  as  a  basis  for  the  calculation  of 

[101] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

the  cost  of  an  itinerary  from  New  York  covering  the  important  cities 
in  South  America  as  also  from  the  principal  cities  in  one  country  to 
the  principal  cities  in  the  countries  adjacent  thereto. 

In  estimating  the  cost  of  a  South  American  trip  for  a  representative 
or  salesman  we  find  that  $20.00  per  day,  exclusive  of  steamship  fare 
to  and  from  New  York  is  about  the  average  rate  of  expense  incurred. 

ARGENTINA 

NEW  YORK  to  BUENOS  AIRES,  one  way  $  U.  S.  490. 
From  BUENOS  AIRES  to 

CITY  SINGLE  RETURN 

Rosario     ....  $18.20  $30.35  Argentine  paper 

Santa  Fe  .     .      .      .  27.85  46.50  Argentine  paper 

Cordoba  .      .      .      .  38.20  57 . 50  Argentine  paper 

Tucuman.      .      .      .  60.30  100.50  Argentine  paper 

From  BUENOS  AIRES  to  the  principal  cities  in  neighboring 
countries 

CITY  SINGLE 

Montevideo,  Uruguay     .      .      .     $20.00  Argentine  paper 

Santiago,  Chile 202 . 80  Argentine  paper 

Rio  de  Janeiro 200 .  oo  Argentine  paper 

BOLIVIA 

NEW  YORK  to  LA  PAZ,  one  way  $  U.  S.  307.65 

BRAZIL 

Bahia    NEW  YORK  to  BAHIA  $  U.  S.  300.  one  way. 
Pernambuco    NEW  YORK  to  PERNAMBUCO,  one  way  $  U.  S.  300. 
Porto  Alegre    NEW  YORK  to  PORTO  ALEGRE,  one  way,  $  U.  S.  490. 

From  PORTO  ALEGRE  to  Rio  DE  JANEIRO  the  equivalent  of 
about  $  U.  S.  50. 

There  is  rail  connection  between  Porto  Alegre  and  Monte- 
video, in  Uruguay,  and  with  Buenos  Aires  in  the  Argentine. 
There  is  also  rail  connection  with  Sao  Paulo  in  Brazil.  The 
trip  to  Montevideo  takes  about  three  days,  and  to  Buenos 
Aires  or  Sao  Paulo  about  four  days.  The  trip  in  either  direction 
is  uninteresting.  Sleeping  conditions  are  very  poor.  Meals  are 
fair. 

[102] 


TRAVEL  TO  AND  IN  SOUTH  AMERICA 


Rio  de  Janeiro    NEW  YORK  to  Rio  DE  JANEIRO,  one  way  $  U.  S.  41 5. 

From  Rio  to  SAO  PAULO,  railway  fare  40^100.  Berth  on  this 
train  usually  costs  15^000  to  i8$ooo. 

Steamship  rate  from  Rio  to  Santos   .      .  25^000 

Rio  to  Bahia   .  90^000  Rio  to  Rio  Grande  138^000 

Rio  to  Recife  .  113^000  Rio  to  Porto  Alegre  163^000 

Rio  to  Para     .  259^000  Rio  to  Montevideo  150^000 

Rio  to  Manaos  363^000  Rio  to  Buenos  Aires  170^000 

Passage  between  local  points  on  Brazilian  steamers  may  be 
paid  in  Brazilian  currency.  English  and  United  States  lines, 
however,  demand  payment  in  sterling,  dollars  or  gold. 

Santos    NEW  YORK  to  SANTOS,  one  way,  $  U.  S.  425.00. 

From  SANTOS  to 

SAO  PAULO  by  railroad  only      6^500 

Rio  by  railroad  only      .      .     6o$ooo 

Rio  by  steamer  ....     31  $000  to  6o$ooo 

Montevideo,  Uruguay,  by  steamer  150^000  to  200^000 

Buenos  Aires,  Argentine  by  steamer  1 50^000  to  200^000 

(Note)  By  rail  baggage  is  charged  for  by  weight  and  as  the  charge  is  excessive  it  is 
advisable  to  travel  as  light  as  possible. 

CHILE 

NEW  YORK  to  VALPARAISO,  one  way,  $  U.  S.  340.00 

From  VALPARAISO  to  SANTIAGO  the  cost  of  travel  is  about 
$  U.  S.  5. 

From  VALPARAISO  to  ANTOFAGASTA  $  U.  S.  35. 

From  VALPARAISO  to  BUENOS  AIRES  $  U.  S.  80.  Rates  are 
constantly  changing. 

COLOMBIA 

NEW  YORK  to  BARRANQUILLA,  one  way,  $  U.  S.  150. 

ECUADOR 

NEW  YORK  to  GUAYAQUIL  $  U.  S.  205.00 


[103] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


GUIANAS 

British  Guiana  NEW  YORK  to  GEORGETOWN,  one  way,  $  U.  S.  140. 
Dutch  Guiana  NEW  YORK  to  PARAMARIBO,  one  way  $  U.  S.  125. 
French  Guiana  NEW  YORK  to  CAYENNE,  one  way  $  U.  S.  125. 

PARAGUAY 

NEW  YORK  to  ASUNCION,  one  way  via  Buenos  Aires, 
$  U.  S.  580.00 


PERU 

NEW  YORK  to  CALLAO  or  LIMA, 

By  steamship  from  CALLAO  to 

SOLES 

Panama,  C.  Z.  .  .  286.00 
Guayaquil,  Ecuador  120.00 
Paita,  Peru  .  .  .  83.60 
Salaverry  (Trujillo)  50.60 
Mollendo  .  .  .  62.60 
Arica,  Chile  .  .  .  69.60 
Iquique,  Chile  .  .  97 .10 
Antofagasta,  Chile  .  146.00 
Valparaiso,  Chile  .  208.00 


one  way  $  U.  S.  260.00 


By  rail  from  Mollendo  to: 
Cuzco,  Peru      .       34-40 
La  Paz,  Bolivia       51 .30 
Free  baggage  to  Cuzco  up 
to  70  Ibs.  and  to  La  Paz  up 
to  150  Ibs.  Charge  for  ex- 
cess is  at  rate  of  20.00  soles 
to  Cuzco  and  24.35  to  La 
Paz,  per  220  Ibs. 


The  cost  of  travel  via  steamship  from  Callao  to  the  ports  men- 
tioned is  given  in  soles.  A  sole  is  approximately  50  cents  U;  S. 
currency. 


URUGUAY 


NEW  YORK  to  MONTEVIDEO,  one  way  $  U.  S.  480. 
From  MONTEVIDEO  to 


CITY 

Salto  by  rail 
Paysandu  by  rail 
Colonia  by  rail 


ONE  WAY 

1 8. 60  Uruguayan  gold 
15 .00  Uruguayan  gold 

7.58  Uruguayan  gold 


From  MONTEVIDEO  to  principal  cities  in  neighboring  countries 
Buenos  Aires,  Argentine  by  boat    1 2 .  oo  Uruguayan  gold 
Porto  Alegre,  Brazil,  by  boat  .      46.00  Uruguayan  gold 
Rio  de  Janeiro,  Brazil,  by  boat     56.00  Uruguayan  gold 

[104] 


HOTEL  SERVICE  IN  SOUTH  AMERICA 


VENEZUELA 


NEW  YORK  to  CARACAS,  one  way  %  U.  S.  70. 

Travel  into  the  interior  of  Venezuela  is  expensive  as  it  is  usually 

by  pack  or  mule  train. 


HOTEL  SERVICE  IN  SOUTH  AMERICA 

r  I  ^HE  HOTEL  service  throughout  South  America  is  patterned 
JL  more  after  European  than  American  standards.  The  rates,  how- 
ever, follow  the  American  plan,  including  meals. 

In  Rio  de  Janeiro  and  Sao  Paulo  in  Brazil,  Montivedeo  in  Uruguay, 
Buenos  Aires  and  Rosario  in  the  Argentine,  at  Santiago  and  Valparaiso 
in  Chile,  and  at  Lima  in  Peru  the  service  is  excellent.  Away  from 
these  cities,  however,  the  service  will  be  found  to  be  second  or  third 
class. 

The  generous  early  morning  breakfast  to  which  Americans  as  a  rule 
are  accustomed  is  somewhat  startling  to  the  South  American  hotel 
proprietor.  The  early  morning  collation  throughout  South  America 
consists  simply  of  coffee  and  rolls  with  sweet  butter.  Breakfast,  which 
corresponds  to  our  lunch,  is  served  from  1 1  to  2,  and  dinner  from  7:30 
to  9  in  the  evening.  It  is  customary  to  have  coffee  or  tea  and  cakes  in 
the  afternoon  from  4  to  6. 

Generally  speaking  hotel  service  is  not  excessive,  at  least  it  will  not 
be  found  more  so  than  it  is  in  this  country,  though  the  taking  of  tips 
and  the  reminding  of  guests  in  this  connection  on  the  part  of  the 
hotel  attendants  will  be  found  a  highly  developed  and  cooperative  art. 

Restaurants  as  we  know  them  in  this  country  are  unknown  in 
South  American  countries.  Cafes  are  popular,  however,  at  which  may 
be  had  drinks  and  refreshment  of  various  kinds  as  well  as  sandwiches 
and  coffee.  The  noon  and  evening  meals,  however,  are  served  at  the 
hotels. 

We  have  on  file  in  our  Foreign  Trade  Department  at  New  York  the 
names. and  rates  of  the  better  class  hotels  in  the  principal  cities  of 
South  America. 


[105] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

FOREIGN  AND  AMERICAN  VISITORS  MAY  HAVE 

THEIR  CORRESPONDENCE  ADDRESSED 

IN  OUR  CARE 

OUR  SOUTH  AMERICAN  friends,  when  visiting  this  country,  are 
at  liberty  to  have  their  correspondence  addressed  to  them  in  care 
of  The  National  City  Bank  of  New  York.  American  travelers  to  South 
America  are  likewise  at  liberty  to  have  their  correspondence  directed 
to  them  in  care  of  any  of  our  branch  banks.  In  our  Foreign  Depart- 
ment at  New  York  will  be  found  ample  desk  facilities  for  the  accom- 
modation of  visitors.  Files  of  the  prominent  newspapers  of  Brazil, 
Uruguay,  the  Argentine,  Chile,  and  Peru  are  likewise  at  the  Bank  for 
the  accommodation  of  our  South  American  friends. 

CORRESPONDENCE 

SHOULD    BE    IN    SPANISH    OR    PORTUGUESE    IF    POSSIBLE 

WHERE  possible,  correspondence  should  be  in  the  language  of 
the  country  with  which  American  merchants  wish  to  establish 
relations;  to  Brazil,  in  Portuguese,  and  to  the  other  South  American 
countries  in  Spanish. 

The  general  rule  followed  is  to  reply  to  correspondence  in  the  same 
language  as  that  used  in  the  letter  received. 

We  must  remember  that  if  we  are  endeavoring  to  establish  relations 
in  a  foreign  country,  we  should  render  the  process  as  easy  and  agree- 
able as  possible  for  the  prospective  client.  When  there  is  imposed 
upon  him  the  necessity  of  paying  to  have  correspondence  translated, 
he  feels  precisely  as  we  would,  were  we  to  be  solicited  for  business  in  a 
language  other  than  English. 

CATALOGUES 

THOUSANDS  of  dollars  are  lost  annually  to  American  merchants 
through  inefficiency  in  the  distribution  of  catalogues  and  general 
advertising  matter  in  South  American  countries. 

Extreme  care  should  be  exercised  in  the  selection  of  mailing  lists. 
A  hardware  catalogue  is  of  no  use  whatever  to  a  dry  goods  or  seed 
merchant  any  more  than  is  the  seed  or  dry  goods  catalogue  to  the 

[106] 


ADVERTISING  AND  TRADE  MARKS 


hardware  dealer  and  yet  it  is  painful  to  note  the  absolute  lack  of 
discretion  exercised  by  many  American  houses  in  this  very  vital  mat- 
ter. Furthermore,  catalogues  or  advertising  literature  to  be  effective 
must  be  printed  in  Portuguese  if  intended  for  distribution  in  Brazil 
and  in  Spanish  if  for  the  other  South  American  countries. 

The  forwarding  of  catalogues  in  English  is  a  positive  waste  of  time, 
effort,  money  and  postage. 

For  the  convenience  of  our  clients  our  Foreign  Trade  Department 
at  New  York  has  on  file  lists  of  firm  names  covering  innumerable 
lines  of  business  throughout  the  various  South  American  countries. 
Catalogues  of  client  firms  forwarded  to  our  South  American  branches 
are  filed  and  cross  indexed  in  our  branch  foreign  department.  Some  of 
the  branches  publish  a  monthly  trade  sheet  which  is  circulated  among 
the  local  trade  and  in  this  are  listed  the  catalogues  received  and  the 
lines  of  merchandise  covered. 

ADVERTISING  IN  SOUTH  AMERICA 

IF,  before  entering  the  South  American  field,  the  line  it  is  intended 
to  introduce  is  one  for  which  a  demand  might  be  created  through 
the  medium  of  advertising,  the  South  American  countries  publish 
many  reliable  newspapers  and  magazines  available  for  this  purpose. 
Our  Foreign  Trade  Department  at  New  York  has  in  its  files  the 
names  of  these  periodicals  with  rates  for  advertising  space  therein, 
and  will  be  pleased  to  furnish  this  information  to  its  clients  upon 
request. 

TRADE  MARKS 

REGISTRATION    IN    SOUTH    AMERICAN    COUNTRIES 

IF  AN  American  firm  contemplates  introducing  a  trade  marked 
article  or  commodity  into  the  South  American  market  it  is  advis- 
able to  have  such  trade  mark  or  brand  registered  beforehand  in  the 
country  or  countries  in  which  it  may  be  desired  to  transact  business. 
In  some  South  American  countries  it  is  possible,  owing  to  the  lax- 
ity of  laws  in  this  respect,  for  anyone  to  register  a  trade  mark  or 
brand.  Considerable  trouble  and  expense  have  been  entailed  upon  both 
American  and  European  manufacturers  in  the  past  through  the  action 
of  some  unscrupulous  person  or  firm  in  having  made  a  prior  registra- 
tion in  South  America  of  a  trade  mark  or  brand  with  the  knowledge 
that  the  original  owners  contemplated  opening  in  a  certain  market. 

[107] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Foreign  houses  have  likewise  been  known  to  take  advantage  of  the 
law  in  this  respect  by  registering  the  trade  mark  or  brand  of  an  Amer- 
ican product  which  if  introduced  would  compete  with  a  line  they 
represented. 

An  instance  has  come  to  our  knowledge  of  one  firm  in  a  large  South 
American  city  having  registered  more  than  fifty  American  trade  marks 
covering  products  which  the  firm  had  reason  to  believe  it  was  the  in- 
tention of  the  owners  to  introduce.  Where  this  has  been  done  a  settle- 
ment has  had  to  be  made  with  the  unscrupulous  registrar  of  the  trade 
mark  or  brand  before  such  mark  could  be  used  by  the  rightful  owner 
in  those  countries  where  such  prior  registration  had  been  made. 

The  Buenos  Aires  Convention  of  1910  provided  for  the  Interna- 
tional Registration  of  Trade  Marks  and  commercial  names.  The  South 
American  countries  were  referred  to  as  the  southern  group,  the  north- 
ern group  being  represented  by  Costa  Rica,  Cuba,  the  Dominican  Re- 
public, Guatemala,  Honduras,  Nicaragua,  Panama,  Mexico,  Haiti, 
Salvador  and  the  United  States. 

Upon  ratification  of  the  convention  by  two-thirds  of  the  countries 
in  the  South  American  group  a  central  office  is  to  be  established  at 
Rio  de  Janeiro.  At  this  writing,  the  ratification  of  two  of  the  countries 
in  the  group  is  still  lacking  to  render  operative  the  central  office  at 
Rio.  The  requisite  two-thirds  ratification  has  been  effected  by  the 
northern  group,  in  consequence  of  which  the  central  registration  office 
of  this  particular  group  is  now  operative  at  Havana,  Cuba. 

Legislation  giving  effect  to  the  convention  in  this  country  has  been 
adopted  by  Congress  and  at  this  writing  is  in  the  hands  of  the  Presi- 
dent for  approval. 

Application  for  trade  marks  for  the  northern  group  may  now  be 
addressed  to  the  International  Bureau  at  Havana.  Until  the  definite 
establishment  at  Rio  de  Janeiro  of  the  office  for  the  southern  group 
it  is  advisable  to  address  the  Bureau  office  at  Havana  since  eminent 
authority  construes  the  convention  as  adopted  as  conferring  upon 
Havana  the  right  to  afford  registration  in  all  countries  signatory  to 
the  convention. 

To  enjoy  the  benefits  of  this  central  registration  the  American  appli- 
cant for  trade  mark  or  commercial  name  registration  must  pay,  in 
addition  to  the  charges  of  the  country  in  which  registration  is  first 
made,  a  fee  of  $50.00  which  covers  all  expenses  for  registration  in  the 
other  countries  of  the  individual  group. 

[108] 


FOREIGN  HOUSES  LOCATING  IN  NEW  YORK 

Information  as  to  further  developments  in  governmental  activity 
in  this  important  matter  may  be  obtained  from  time  to  time  by  ad- 
dressing the  Commissioner  of  Patents  at  Washington. 

The  services  of  our  Foreign  Trade  Department  are  likewise  at  the 
disposition  of  inquirers  in  this  connection. 

SEASONAL  CHANGES 

THE  SEASONS  of  the  year  in  Brazil,  the  Argentine,  Uruguay, 
Paraguay,  and  Chile  are  the  reverse  of  those  in  the  countries  north 
of  the  Equator,  their  winter  occurring  during  our  summer  and  vice 
versa. 

A  realization  of  this  difference  in  seasons  between  countries  north 
and  south  of  the  Equator  will  enable  the  American  exporter  to  adjust 
his  advertising  and  sales  campaigns  accordingly.  This  may  also  explain 
the  reason  for  many  complaints  from  merchants  in  that  part  of  the 
world  regarding  delay  in  the  receipt  of  seasonable  merchandise. 

FOREIGN  HOUSES  ARE  NOW  ESTABLISHING 
PURCHASING  OFFICES  IN  NEW  YORK 

THE  number  of  South  American  and  European  houses  establish- 
ing purchasing  offices  in  New  York  is  perceptibly  increasing  and 
will  continue  to  increase  as  world  conditions  approach  more  to  normal. 

This  has  been  found  necessary  during  the  strenuous  times  through 
which  we  have  passed,  and  our  foreign  friends  who  have  opened  such 
offices  are  finding  that  the  benefits  accruing  therefrom  through  the 
resultant  concentration  on  their  particular  interests  in  this  country  far 
more  than  compensate  for  the  expense  involved. 

One  large  Argentine  firm  having  a  purchasing  office  in  New  York 
recently  saved  $30,000  on  one  order  through  having  its  own  agent  on 
the  ground  to  devote  his  attention  to  its  interests. 

LOCAL  MANUFACTURING  IN  SOUTH  AMERICA 

Argentina 

THE  ARGENTINE  is  primarily  an  agricultural  and  cattle  raising 
country.  Lack  of  coal  and  iron  must  retard  its  industrial  development 
for  many  years  to  come.  What  strides  it  has  made  in  manufacturing 

[109] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

have  been  mostly  in  food  and  textiles.  American  shoes,  however,  even 
with  the  protective  tariff  on  the  home  product,  meet  with  much  favor 
as  the  stock  is  better  cured  and  the  shoe  is  not  only  better  made  but 
retains  its  shape  and  wears  longer. 

The  textile  industry  while  fairly  well  developed  does  not  meet  the 
requirements  of  the  market  and  the  opportunities  for  intensive  Amer- 
ican development  are  very  favorable.  Most  of  the  manufactured  goods 
used  in  the  country  are  of  American  and  European  importation. 

Brazil 

INDUSTRIALLY  Brazil  has  advanced  materially  within  the  past 
few  years.  The  field  embraced  is  growing  and  now  includes  the  manu- 
facture of  cotton  prints,  food  stuffs,  drugs,  woolen  goods,  cigars, 
cigarettes,  beers,  wines,  shoes,  carriages,  wagons  and  ground  coffee. 

Cattle  raising  is  on  a  large  scale,  especially  in  the  states  of  Rio 
Grande  do  Sul,  Minas,  Goyaz,  Matto  Grosso  and  Ceara. 

Chile 

THE  ACTIVITY  of  Chilean  manufactures  is  particularly  marked 
in  the  following  lines: 

Ready-made  clothing,  hats,  cement,  beer,  mineral  waters,  industrial 
distilleries,  refined  sugar,  canned  fruits  and  vegetables,  foot  wear, 
tobacco  and  cigarettes. 

Colombia 

WOOLEN  and  cotton  textiles,  shoes,  matches,  cigars,  ciga- 
rettes and  Panama  hats. 

The  wool  and  cotton  textile  factories  are  quite  modern.  All  manu- 
factures, however,  are  of  a  cheap  quality.  If  the  better  quality  is 
desired,  imported  articles  are  purchased. 

Ecuador 

WOOLEN  and  cotton  textiles,  shoes,  matches,  chocolate,  soap 
and  sugar. 

The  products  manufactured  do  not  meet  the  requirements  for  home 
consumption.  There  is  no  export  trade  in  manufactured  goods. 

Paraguay 

LOCAL  manufacturing  in  Paraguay  is  confined  to  furniture, 
soap  and  alcoholic  beverages. 

[IIO] 


RESUME  OF  SHIPPING  REQUIREMENTS 


Peru 

MANUFACTURING  in  Peru  has  not  been  developed.  Furniture 
and  the  cheaper  classes  of  cotton  and  woolen  goods,  foundry  castings 
and  parts,  brick  and  tile,  cotton  seed  oil  and  cake,  Panama  hats,  shoes, 
biscuits,  chocolates  and  candies  are  produced  locally.  There  are  a  few 
flour  mills,  tanneries  and  other  minor  industries.  Most  of  the  establish- 
ments, excepting  the  hat  manufactories,  are  comparatively  small  and 
their  production  is  consumed  locally.  The  exports  of  Peru  are  chiefly 
raw  materials. 

Uruguay 

LOCAL  manufacturing  in  Uruguay  is  confined  to  the  city  of 
Montevideo  and  is  restricted  to  cloth,  shoes,  furniture,  paper  and  sta- 
tionery, flour  and  food  stuffs. 

Venezuela 

IN  VENEZUELA  shoes,  leather  work  in  general,  soap,  choco- 
lates and  some  glassware  are  manufactured  in  fairly  good  grades. 
Venezuela  endeavors  to  protect  its  home  manufactures  by  the  im- 
position of  excessive  taxes  on  imported  articles  of  the  same  kind. 

RESUME  OF  SHIPPING  REQUIREMENTS 

IMPORTANT  INFORMATION  COVERING  SHIPMENTS  TO 

VARIOUS  SOUTH  AMERICAN  COUNTRIES 
Argentina 

THE  PRINCIPAL  port  in  the  Argentine  is  Buenos  Aires.  Sailings 
are  maintained  from  New  York,  Mobile,  and  New  Orleans.  Shipments 
require  Consular  invoice  written  in  Spanish.  Cases,  bales  and  packages 
may  be  marked  either  with  a  stencil  or  brush.  It  is  likewise  necessary 
that  cases,  bales  and  packages  bear  the  shipping  mark  and  number  as 
well  as  the  name  of  steamer  by  which  goods  are  shipped.  This  should 
appear  on  two  sides.  The  observance  of  this  rule  will  facilitate  release 
through  foreign  customs. 

Bolivia 

THROUGH  bills  of  lading  are  not  issued  to  interior  points  of 
Bolivia.  Shipments  for  this  country  may  be  made  via  ports  in  Chile, 
Peru,  Brazil  and  in  the  Argentine.  Sailings  are  maintained  from  New 

[in] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

York  via  Peruvian  and  Chilean  ports.  Consular  invoice  covering  ship- 
ment must  be  in  Spanish.  Cases,  bales  or  packages  should  be  plainly 
marked  with  either  a  stencil  or  brush  with  the  number  of  the  piece  as 
well  as  the  name  of  the  steamer.  In  this  connection,  however,  it  should 
be  noted  that  if  shipment  is  to  be  made  via  a  port  in  Chile,  marking 
on  case  or  bale  must  be  with  a  stencil.  Gross  and  net  weights  in  kilos 
must  likewise  be  marked  on  each  piece,  and  these  must  agree  with  the 
weights  as  given  in  the  Consular  invoice  and  on  the  bills  of  lading. 

Brazil 

SAILINGS  are  maintained  from  this  country  from  the  ports  of 
New  York  and  New  Orleans,  touching  at  the  Brazilian  ports  of  Para, 
Pernambuco,  Bahia,  Rio  de  Janeiro  and  Santos.  Consular  invoice  may 
be  written  in  either  English  or  Portuguese.  If  in  English,  however,  a 
translation  charge  is  made  at  destination.  Cases  or  packages  may  be 
marked  with  either  a  stencil  or  brush. 

British  Guiana 

THE  PRINCIPAL  port  is  Georgetown.  Sailings  are  maintained 
from  New  York.  No  consular  documents  are  necessary  and  no  restric- 
tions are  made  as  to  shipping  marks,  weights,  etc. 

Chile 

THE  PORTS  of  Chile  are  Valparaiso,  Talcahuano,  Antofagasta, 
Iquique  and  Coquimbo.  Sailings  are  maintained  from  New  York  and 
New  Orleans.  Consular  invoices  should  be  in  Spanish.  Markings  on 
cases,  bales  or  packages  must  be  with  stencil.  The  words  "Gross  Kilos'* 
with  the  number  of  kilos  should  be  stenciled  on  each  piece. 

Colombia 

THE  PORTS  of  Colombia  are  Cartegena,  Buena  Ventura  and 
Porto  Colombia.  Sailings  are  maintained  from  New  York,  Philadel- 
phia, Baltimore  and  New  Orleans.  Consular  invoices  should  be  in 
Spanish.  Cases  or  packages  may  be  marked  with  either  a  stencil  or 
brush. 

Ecuador 

THE  PORT  of  Ecuador  is  Guayaquil.  Sailings  are  maintained 
from  New  York  and  New  Orleans.  Consular  invoices  must  be  in 


SHIPPING  TERMS 


Spanish.  Packages  may  be  marked  with  either  stencil  or  brush.  The 
gross  weight  in  kilos  should  be  marked  on  cases  or  packages. 

Paraguay 

THE  PORT  of  Paraguay  is  Asuncion.  Sailings  are  maintained 
from  New  York,  Mobile  and  New  Orleans,  via  Brazilian,  Uruguayan 
and  Argentine  ports.  Consular  invoice  must  be  in  Spanish.  A  certifi- 
cate of  origin  is  required. 

Peru 

THE  PORTS  of  Peru  are  Callao,  Salaverry  and  Mollendo.  Sail- 
ings are  maintained  from  New  York  and  New  Orleans.  Consular  in- 
voices should  be  in  Spanish.  Packages  may  be  marked  with  either 
stencil  or  brush.  The  gross  weight  in  kilos  should  be  marked  on  cases 
or  packages. 

Uruguay 

THE  PRINCIPAL  port  is  Montevideo.  Sailings  are  maintained 
from  New  York,  Mobile  and  New  Orleans.  Consular  invoice  should  be 
in  Spanish.  Cases  and  packages  should  be  stenciled  with  marks  and 
numbers.  The  regulations  covering  shipments  to  Uruguay  state  that 
marks  on  packages  must  be  clearly  and  legibly  stamped  in  indelible 
ink  and  in  mold  letters. 

Venezuela 

THE  PORTS  of  Venezuela  are  La  Guaira  and  Puerto  Cabello. 
Sailings  are  maintained  from  New  York.  Consular  invoice  should  be 
in  Spanish.  Packages  may  be  marked  with  either  stencil  or  brush. 


SHIPPING  TERMS  AND  THEIR 
EXPLANATION 

IN  QUOTING  prices  to  foreign  firms  in  which  shipping  terms  are 
used  extreme  care  should  be  taken  to  make  clear  the  intention  of 
such  terms  in  order  to  avoid  any  possible  misunderstanding  or  mis- 
interpretation, particularly  where  terms  such  as  F.O.B.  New  York  or 
F.O.B.  Destination  may  easily  become  susceptible  of  different  mean- 
ings. On  sales  to  South  America  the  terms  frequently  used  are: 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

F.O.B.  Free  on  Board 

F.O.B.  Destination 

F.O.B.  New  York  (or  other  shipping  port) 

F.A.S.  Free  Along  Side 

C.I.F.  Cost,  Insurance  and  Freight 

C.&F.  Cost  and  Freight 

The  generally  accepted  interpretation  of  these  terms  is: 

F.O.B.  Steamer 

UNDER  these  terms  the  seller  agrees  to  place  the  goods  on  board 
steamer,  subsequent  risk  and  expense  running  for  the  account  of 
consignee. 

F.  O.  B.  Destination 

THESE  TERMS  presuppose  payment  by  seller  of  all  expenses  up 
to  the  time  of  actual  delivery  of  the  merchandise  to  the  point  agreed 
upon.  The  terms  "F.O.B.  Destination"  are  susceptible  of  various  con- 
structions and  a  distinct  understanding  should  be  had  at  the  time  these 
terms  are  quoted  as  to  the  significance  it  is  intended  to  give  to  them. 
Destination  could  mean  simply  "arrival  at  the  port  in  foreign  coun- 
try." Under  this  construction  if  the  steamer  anchor  some  distance  off 
port,  lighterage  and  cartage  would  be  for  the  account  of  purchaser.  If 
actual  delivery  to  the  business  house  of  purchaser  is  intended,  then 
the  terms  should  read  F.O.B.  Warehouse,  or  some  such  distinctive 
term  which  is  not  subject  to  an  ambiguous  construction. 

F.  0.  B.  New  York 

THESE  terms  do  not  necessarily  mean  delivery  to  steamship 
wharf  and  might  be  construed  to  mean  delivery  simply  to  the  New 
York  terminal  freight  yards  of  the  railroad  carrying  the  goods  to 
New  York.  Under  this  construction  cartage  and  storage  expenses 
from  the  date  of  arrival  in  New  York  to  the  actual  sailing  time  of 
steamer  would  be  for  the  account  of  purchaser.  Under  this  construc- 
tion it  is  advisable  that  provision  be  made  under  the  terms  quoted 
to  cover  insurance  for  this  intervening  period. 

F.  A.  S. 

THESE  terms  presuppose  the  delivery  by  seller  to  steamer  side 
and  in  the  event  of  steamer  being  moored  some  distance  from  shore 

[114] 


SHIPPING  TERMS 


would  include  the  payment  of  lighterage  to  within  reach  of  the  ship's 
tackle.  If  steamer  is  alongside  wharf,  then  these  terms  would  mean  de- 
livery at  such  wharf,  subsequent  risk  and  expense  running  for  the 
account  of  purchaser. 

C.  I.  F. 

UNDER  THESE  terms  the  shipper  sells  his  merchandise  with  the 
understanding  that  he  is  to  defray  all  expenses  involved  in  the  delivery 
of  the  merchandise  on  board  steamer  and  in  addition  that  he  will 
insure  the  goods  for  the  trip  and  pay  the  freight  thereon.  In  this  con- 
nection, however,  it  is  important  to  note  that  these  requirements 
having  been  complied  with,  the  obligation  of  the  shipper  terminates 
with  the  acknowledgment  in  the  form  of  the  bill  of  lading  of  receipt  of 
the  merchandise  by  the  steamship  agent  or  company,  the  risks  of  the 
voyage  and  the  delivery  of  the  shipment  running  for  the  account  of 
the  purchaser.  Wherever  possible  it  is  advisable  to  quote  C.  I.  F. 
Destination  prices,  instead  of  F.  O.  B.  Factory  or  Port  of  Shipment. 
The  reason  for  this  is  obvious  as  the  purchaser  in  the  foreign  country, 
in  the  absence  of  having  an  agent  at  New  York  or  at  the  port  of 
shipment,  has  no  means  of  knowing  the  cost  of  insurance  or  of  making 
arrangements  therefor  or  for  the  shipping  of  the  order  without  incur- 
ring the  additional  expense  of  a  freight  forwarder  or  commission  mer- 
chant at  the  port  of  shipment.  Where  "C.I.F.  Buenos  Aires"  is  quoted 
an  Argentine  merchant  is  in  a  preferential  position  as  compared  with 
that  in  which  he  finds  himself  on  merchandise  purchased  F.O.B. 
Factory  or  shipping  port,  as  the  uncertainty  is  removed  regarding 
fluctuating  freight  rates  and  costs  of  insurance.  This  tends  materially 
to  facilitate  not  only  the  original  sale  but  likewise  the  disposition  of 
the  goods  by  the  purchaser. 


THE  COURTS  of  all  commercial  countries  have  decided  upon  the  current 
acceptation  of  these  terms  in  general  use,  but  it  is  always  in  the 
interest  of  good  feeling  between  business  houses  to  have  a  distinct 
understanding  as  to  the  interpretation  which  is  intended  to  be  given 
to  any  terms  which  may  be  quoted. 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


FOREIGN  TRADE— HOLD  WHEN  ONCE  SECURED 

THE  development  of  a  permanent  foreign  trade  requires  as  much 
care  and  attention  to  holding  business  once  secured  as  it  does  to 
its  original  development,  and  as  competition  increases,  the  truth  of 
this  assertion  becomes  more  apparent.  As  an  aid  to  the  development 
and  retention  of  foreign  business,  we  would  offer  the  following  sug- 
gestions. 

FIRST.  That  correspondence  be  in  the  language  of  the  country  in 
which  client  is  located;  that  is,  if  the  customer  is  a  subject  or  citizen 
of  that  country,  and  if  it  is  not  known  that  he  is  familiar  with  English. 

There  is  likewise  a  prevalent  complaint  throughout  South  America 
as  to  apparent  laxity  in  our  methods  of  correspondence.  It  must  be 
remembered  that  South  American  clients  are  many  thousands  of  miles 
from  their  sources  of  supply,  and  inquiries  should  be  answered  imme- 
diately and  in  detail.  If  an  order  is  received,  and  conditions  render 
impossible  immediate  manufacture,  this  information  should  be  com- 
municated immediately  to  foreign  client,  and  if  delay  in  shipping  is 
occasioned  for  any  reason,  notice  to  this  effect  by  cable  or  letter  will 
be  appreciated.  In  other  words,  it  is  advisable  to  keep  foreign  clients 
constantly  advised  as  to  the  progress  that  is  being  made  with  their 
orders.  In  fact,  the  opportunity  of  corresponding  in  this  manner 
should  be  taken  advantage  of,  as  in  addition  to  placating  a  customer 
by  keeping  him  informed  there  is  an  element  of  courtesy  involved 
which  is  appreciated. 

SECOND.  In  selling,  endeavor  to  give  foreign  client  what  he  wants, 
and  not  just  what  you  wish  to  sell  him.  The  application  of  this  prin- 
ciple is  the  basis  upon  which  was  constructed  the  vast  foreign  trade 
of  England,  France,  and  Germany  before  the  war. 

THIRD.  Conform  strictly  to  the  instructions  of  customers  as  to  pack- 
ing, billing  and  the  preparation  of  documents.  It  is  well  to  assume  that 
the  foreign  merchant  is  probably  more  familiar  with  the  requirements 
of  his  own  government  and  the  customs  or  habits  of  his  own  trade 
than  we  can  possibly  be. 

FOURTH.  Investigate  the  credit  standing  of  those  with  whom  you 
contemplate  establishing  relations.  The  information  now  in  our  credit 
files  covering  every  country  in  South  America  should  be  of  incalculable 
assistance  to  our  clients  in  enabling  them  to  grade  their  credit  terms 
to  conform  to  the  financial  and  moral  responsibility  of  their  South 
American  customers. 

[116] 


FUTURE  OF  AMERICAN  FOREIGN  TRADE 


AMERICAN  FOREIGN  TRADE— ITS  FUTURE 

THE  POSITION  of  this  country  during  the  war  was  an  extremely 
difficult  one.  Not  only  had  we  become  for  the  time  being  the 
banker  and  supply  house  of  the  world,  but  the  cataclysm  of  a  world 
war  with  its  imperative  and  immediate  demands  had  placed  almost 
insuperable  obstacles  in  the  way  of  our  adequately  answering  this 
universal  demand  upon  us. 

Now,  however,  that  peace  is  again  established  the  country  appears 
to  be  slowly  awakening  to  a  realization  that  no  nation  of  the  world  has 
ever  had  thrust  upon  it  the  foreign  trade  possibilities  which  are  now 
opened  up  before  us.  Before  the  world  conflict  Germany  and  England 
were  impelled  by  economic  forces  to  develop  external  markets  for 
their  surplus  products,  inasmuch  as  their  productive  machinery  was 
producing  a  surplus  above  that  required  for  home  consumption.  The 
United  States,  on  the  other  hand,  to  the  time  of  the  outbreak  of  the 
war  had  been  growing  with  such  tremendous  strides  that  any  prepara- 
tion for  foreign  trade  was  soon  overtaken  by  the  home  demand. 

Now,  however,  with  the  termination  of  the  war  the  productive 
capacity  of  all  Europe  will  again  be  diverted  to  the  interests  of  peace 
and  competition  for  world  markets  must  of  necessity  become  keen.  In 
this  crisis  if  this  country  is  to  keep  in  productive  activity  the  vast  new 
forces  which  were  created  during  the  war  to  enable  us  to  answer  the 
demand  of  the  world  upon  us  for  our  products,  we  have  no  alternative 
but  to  enter  actively  into  this  competition  in  an  endeavor  to  develop 
permanent  markets  for  the  surplus  which  these  forces  must  inevitably 
create. 

With  a  view  to  meeting  this  competition  the  highest  intelligence 
that  can  be  spared  from  our  various  lines  of  business  interested  in 
foreign  development  should  visit  South  America.  This  preliminary 
survey  should  not  be  left  to  salesmen.  It  must  be  remembered  that  in 
South  America  there  are  today  approximately  sixty-five  millions  of 
people.  The  field  is  a  vast  one  and  has  heretofore  been  intensively 
cultivated  by  Europe. 

An  axiom  in  foreign  trade  is  that  "Business  follows  Investment." 
The  vast  foreign  commerce  transacted  before  the  war  between  Europe 
and  South  America  was  based  primarily  upon  Europe's  investment  in 
South  American  bonds  and  public  utilities  of  every  description.  The 
opportunities  for  such  further  investment  are  extensive  and  should 
now  be  taken  advantage  of  by  American  capital. 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 

Within  the  past  few  years  the  great  packing  interests  in  this  country 
have  established  large  plants  in  Brazil,  in  Uruguay  and  in  the  Argen- 
tine and  American  mining  companies  are  constantly  augmenting  their 
holdings  in  Chile  and  along  the  West  Coast.  Practically  every  line  of 
American  business  effort  is  now  represented  in  the  various  South 
American  countries  and  the  constant  inquiries  we  receive  indicate 
an  ever  increasing  interest  on  the  part  of  American  business  men,  not 
only  in  South  American  trade  development,  but  likewise  in  the  possi- 
bilities of  the  southern  continent  for  the  investment  of  capital.  The 
measure  of  our  ability,  therefore,  to  retain  the  foreign  business  which 
abnormal  world  conditions  have  temporarily  diverted  to  this  country 
will  be  the  extent  to  which  we  intelligently  cultivate  the  trade  of  our 
new  acquaintances.  If  we  will  now  bring  to  bear  upon  our  efforts  at 
reconstruction  and  the  development  of  a  permanent  foreign  trade  that 
same  intelligence  and  energy  which  we  devoted  intensively  to  the 
prosecution  of  the  war,  our  efforts  in  this  direction  should  meet  with 
a  like  measure  of  success.  We  must  remember,  however,  that  the  con- 
fidence of  foreign  merchants  can  be  inspired  only  by  properly  pricing 
our  goods  for  export;  by  according  time  where  the  credit  standing  of 
foreign  client  so  warrants;  by  scrupulously  adhering  to  instructions 
regarding  packing  and  billing;  by  avoiding  substitution  without  secur- 
ing the  consent  of  client  thereto,  and  in  general,  through  endeavoring 
to  impress  upon  our  foreign  friends  by  the  manner  in  which  we  fill 
their  orders  our  desire  to  develop  a  permanent  foreign  trade  by  apply- 
ing to  the  business  with  which  they  favor  us  those  same  high  principles 
of  scrupulous  business  probity  which  have  built  up  the  vast  domestic 
commerce  of  this  country. 


[118] 


INDEX 


FOREWORD 5 

FOREIGN  BRANCH  BANKS 7 

SERVICES  RENDERED  BY  BRANCH  BANKS  8 

CREDIT  SERVICE 9 

Foreign  Credit  Data 9 

Credit  Data  on  American  Houses  Filed 

with  our  Foreign  Branches  10 
Commercial  Department      .      .      .      .  10 
FOREIGN  DISTRIBUTING  AGENCIES     .      .  H 
Caution  in  the  Arrangement  of  Exclu- 
sive Agencies 1 1 

SELLING  TERMS  12 


INSTRUCTIONS  FROM  CLIENT    . 
Substitution  of  Merchandise 

PACKING 

Packing  and  Import  Duties 
Labels  on  Merchandise  . 


FINANCING 17 

The  Open  Account 17 

Commercial  Credits 17 

Unconfirmed  or  Revocable  ....  1 8 

Confirmed  or  Irrevocable  .  1 8 

Clean  Credit 19 

Documentary  Credit 19 

Acceptance  Credit 19 

Revolving  Credit 20 

How  COMMERCIAL  CREDITS  ARE  OPENED  21 

DRAFTS 27 

Sight  Drafts 27 

Time  Drafts 28 

Usance  or  Tenor — Sight  and  Time      .  28 

Drafts — Clean  and  Documentary  .      .  28 

Discounting  Drafts 28 

Drafts  in  Cover  for  Parcel-Post  Ship- 
ments      29 

Dollar  Drafts 29 

Rebating  Drafts 29 

Rates  for  Discounting  Drafts    ...  29 

Negotiability  of  Drafts 30 

Acceptance  of  Drafts 30 

COLLECTION  or  DRAFTS 30 

Rates 30 

Payment 31 

Privilege  of  Examination  of  Merchan- 
dise before  Payment  or  Acceptance  of 

Draft ..31 

Instructions  Accompanying  Drafts      .  31 
Action  by  Foreign  Bank  on  Uncollected 

Items 32 

Sale  of  Merchandise  under  Uncollected 

Items 33 


EXAMINATION  OF  MERCHANDISE  IN  SOUTH 
AMERICAN  COUNTRIES  BEFORE  PAY- 
MENT OR  ACCEPTANCE  OF  CORRE- 
SPONDING DRAFTS: 

Argentina 33 

Bolivia 33 

Brazil 33 

Chile 34 

Colombia 34 

Ecuador 34 

Paraguay 35 

Peru 35 

Uruguay          35 

Venezuela 35 

FOREIGN  STAMP  CHARGES: 

Argentina 36 

Bolivia 36 

Brazil 36 

Chile 36 

Colombia 36 

Ecuador 37 

Paraguay 37 

Peru 37 

Uruguay •      •  37 

Venezuela .37 

PROTEST  or  DRAFTS: 

Advisability  of  Protest 38 

Argentina 38 

Bolivia 38 

Brazil 38 

Chile 39 

Colombia 39 

Ecuador 39 

Paraguay 39 

Peru 40 

Uruguay 40 

Venezuela 40 

LEGAL   SERVICES   IN   SOUTH   AMERICAN 

COUNTRIES 40 

SHIPMENTS  FROM  THE  INTERIOR  FOR  EX- 
PORT    41 

Shipments  to  Interior  Points  in  South 

America 42 

DOCUMENTS 42 

Set  of  Documents 43 

Consular  Invoice 43 

Insurance  Certificate 43 

Combined  Shipments  on  One  Set  of 

Bills  of  Lading 44 

BILLS  OF  LADING: 

Consignment  of  Shipments  ....  45 

"To  Order"  Shipments 45 

Number  of  Ladings 46 

Tax  in  South  America  on  Bills  of  Lading  46 


[H9J 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


RELEASE  or  SHIPMENTS  FROM  CUSTOM- 

DOCUMENTS  NECESSARY: 

Argentina  .........  47 

Bolivia      .........  48 

Bra/51  ..........  48 

Chile    ..........  51 

Colombia  .........  51 

Ecuador    .........  53 

Paraguay  .........  53 

Peru     ..........  54 

Uruguay    .........  55 

Venezuela       ........  57 

Kl-.l.  I    \M      <>|      SlIII'MI   NI.S     M«)M     C'llSIOM 

IN  THE  ABSENCE  or  DOCUMENTS  — 

FORMALITIES  IMPOSED: 

Argentina  .........  47 

Bolivia      .........  48 

Brazil  ..........  50 

Chile    ..........  52 

Ecuador    .........  53 

Paraguay  .........  54 

P.eru     ..........  55 

Uruguay  .........  57 

Venezuela       ........  57 

BILLS  or  LADING—  MANNER  or  CONSIGN- 


ING: 

Argentina 

Bolivia 

Brazil 

Chile 

Colombia 

Ecuador 

Paraguay 

TPTcru 
Uruguay 

Venezuela 


BILLS  or  LADING  —  ENDORSEMENT  TAX: 
Argentina 
Bolivia 
Bra/il 
Chile 
Colombia 
Ecuador 
Paraguay 


T 
Uruguay 

Venezuela 


PERIOD  AND  CONDITIONS  UNDER  WHICH 
MERCHANDISE  MAY  REMAIN  IN  THE 
CUSTOM  WAREHOUSE  AFTER  ARRIV- 
AL IN  SOUTH  AMERICA: 

Argentina       ........ 

Bolivia      ......... 

Brazil  .......... 

Bahia     ......... 

Pernambuco     ....... 

Porto  Alegre  ....... 


47 
48 
49 
51 
51 
53 
54 

54 
55 
57 

47 
48 
49 
52 
51 
53 
54 

55 
55 

57 


58 
58 
59 
59 
59 
60 


Rio  de  Janeiro 60 

Santos 60 

Chile 61 

Ecuador 61 

Paraguay 61 

Peru 61 

Uruguay 6a 

Venezuela 63 

STORAGE  FACILITIES  IN  SOUTH  AMERICA: 

Argentina 63 

Bolivia 63 

Brazil 64 

Chile 64 

Colombia 64 

Ecuador 64 

Paraguay 64 

Peru 65 

Uruguay 65 

Venezuela 65 

INSURANCE 65 

Blanket  Policies 66 

Argentina 66 

Bolivia 66 

Brazil 66 

Chile 67 

Colombia 67 

Ecuador 67 

Paraguay 67 

Peru 67 

Uruguay 63 

Venezuela 68 

1'OSIAOK  UAH'S  AND  CONDITIONS  AlMM.I- 
CADLE  IN  SOUTH  AMERICAN  COUN- 
TRIES    68 

MAIL   TIME   TO   PRINCIPAL   CITIES    IN 

SOUTH  AMERICA 69 

PARCEL-POST  TO  SOUTH  AMERICAN  COUN- 
TRIES    70 

Argentina 70 

Bolivia 71 

Brazil 71 

Bahia 74 

Pernambuco 74 

Porto  Alegre 74 

Rio  de  Janeiro 75 

Santoi 75 

Chile 75 

Colombia 76 

Ecuador 76 

Guianat 77 

Paraguay 77 

Peru 77 

Uruguay 78 

Venezuela •     •  79 

PARCEL-POST — GENERAL  OBSERVATION  .  79 
Drafts  in  cover  for  parcel-post   ship- 
ments      80 


[120] 


INPKX 


CABLES 

FOREIGN  EXCNANOI 

South  American  Monetary  Value* 
FOREIGN  WEIGHTS,  MEASURES  AND  GEN- 
ERAL UNITS 

METRIC  EQUIVALENTS  IN  WEIGHTS  AND 

MEASURES . 

METRIC  DRY  MEASURE 

METRIC  LIQUID  MEASURE  .... 
METRIC  MEASURES  or  LENGTH  .  .  . 
METRIC  SURFACE  MEASURES  . 
LOCAL  FOREIGN  WEIGHTS  AND  MEASURES 
REDUCTION  or  POUNDS  TO  KILOS  (REFER- 
ENCE TABLE)  

REPRESENTATIVES  OR  SALESMEN,  CARE 

TO  IE  OBSERVED  IN  THEIR  SELECTION 

SALESMEN'S  LICENSES  IN  SOUTH  AMERICA 

Argentina 

Bolivia 

Brazil 

Chile 

Colombia 

Ecuador    

Paraguay 

Peru 

Uruguay 

Venezuela       . 

SAMPLES — RULES    GOVERNING    CUSTOM 
v  IN  SOUTH  AMERICAN  COUN- 
TRIES: 

Argentina 

Bolivia 

Braiil 

Chile 

Ecuador    

Paraguay  

• 

Uruguay 

Venezuela 

BRANCH  OFFICES  OF  AMERICAN  COMPAN- 
IES —  REQUIREMENTS  IN  SOUTH 
AMERICA: 

Argentina 

Brazil 

Chile 

Colombia 

Bolivia 

Ecuador    

Paraguay 

Peru 

Uruguay 

Venezuela 

RUBRICATION  OR  LEGAL  REGISTRATION  OF 

BOOKS    OF    ACCOUNT    IN    FOREIGN 

OFFICES 

LETTERS  OF  CREDIT  AND  TRAVELERS' 
CHECKS 


80 
81 
81 

81 
81 


84 

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86 

u 

«7 

•7 

ss 

ss 

If 

«9 
89 

So 

90 
90 
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90 
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9» 
91 
91 
91 
91 


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LETTERS  or  INTRODUCTION  TO  SOUTH 

AMERICA 101 

TRAVEL  To  AND  IN  SOUTH  AMERICA  .     .  101 

Argentina 101 

Bdivia loa 

Brazil 101 

Bahia loa 

Pernambuco 101 

Porto  Alegre 101 

Riode  Janeiro       ....  .103 

Santos 103 

Chile 103 

Colombia 103 


Ecuador 


qq 

[121] 


104 
Paraguay  .........  104 

Peru     ..........   104 

Uruguay    .........   104 

Venezuela       ........   105 

HOTEL  SERVICE  IN  SOUTH  AMERICA  .     .   105 
FOREIGN  VISITORS  TO  THIS  COUNTRY  .  106 
CORRESPONDENCE—  RULES  GOVERNING  .  106 
CATALOGUES      ........  106 

ADVERTISING  IN  SOUTH  AMERICA       .     .  107 
TRADE  MARKS  —  REGISTRATION  IN  SOUTH 
AMERICAN  COUNTRIES     ....  107 

SEASONAL  CHANGES      ......   109 

FOREIGN    HOUSES    Now    ESTABLISHING 

BRANCH  OFFICES  IN  NEW  YORK      .  109 
LOCAL  MANUFACTURING  IN  SOUTH  AMER- 

i.  \ 
Argentina  .........   109 

Bra/il  ..........    no 

Chile    ..........   no 

Colombia  .........   no 

Ecuador    .........   no 

Paraguay  .........    no 

Peru     ..........   ill 

Uruguay    .........   in 

Venezuela  .........   ill 

SHIPPING  REQUIREMENTS  —  Important  in- 
formation covering  Shipments  to  va- 
rious South  American  countries: 
Argentina  .........   1  1  1 

Bolivia      .........  in 

Brazil  ..........   in 

British  Guiana     .......   in 

Chile    ..........   in 

Colombia  .........  112 

Ecuador    .........   in 

Paraguay  .........   nj 

Peru     ..........   113 

Uruguay   .........  113 

uela       ........  113 

SHIPPING  TERMS  AND  THEIR  EXPLANA- 
TION ..........  113 

FOREIGN  TRADE  —  HOLD  ONCE  SECURED  .  116 
AMERICAN  FOREIGN  TRADE  —  ITS  FUTURE  117 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


INDEX  BY  COUNTRIES 


ARGENTINA 

Branches  7 

Examination   of  Merchandise   Before 

Acceptance  of  Draft 33 

Stamp  Charges 36 

Protest  of  Drafts 38 

Release  of  Shipments  from  Custom — 

Documents  Necessary      ....     47 
Release  of  Shipments  from  Custom  in 
the  Absence^of  Documents — Formal- 
ities Imposed 47 

Bills  of  Lading — Manner  of  Consigning    47 
Bills  of  Lading — Endorsement  Tax  .     47 
Period  and  Conditions  Under  which 
Merchandise  May  Remain  in  Cus- 
toms Warehouse  After  Arrival    .      .     58 

Storage  Facilities 63 

Insurance  on  Merchandise  Under  Un- 

collected  Drafts 66 

Mail  Time  To  and  Period  in  Which  Re- 
ply may  be  Expected 69 

Parcel-Post — Rules  Governing  ...     70 
Foreign  Exchange — Monetary  Values.     81 
Local  Weights  and  Measures    ...     85 
(See  also  Metric  Weights  and  Mea- 
sures). 

Salesmen's  Licenses 87 

Samples — Rules    Governing     Custom 

Entry 90 

Branch  Offices  of  American  Compan- 
ies— Requirements     in     Connection 

Therewith 93 

Cost  of  Travel  from  New  York  to  and 

in  the  Argentine 102 

Local  Manufacturing 109 

Important  Information  Covering  Ship- 
ments     in 

BOLIVIA 

Examination   of  Merchandise   Before 

Acceptance  of  Draft 33 

Stamp  Charges 36 

Protest  of  Drafts 38 

Bills  of  Lading — Manner  of  Consigning    48 
Period   and   Conditions   under   which 
Merchandise  may  Remain  in  Cus- 
tom Warehouse  After  Arrival    .      .     58 

Storage  Facilities 63 

Insurance  on  Merchandise  under  Un- 

collected  Drafts 66 

Mail  Time  to  and  Period  in  which  Re- 
ply may  be  Expected 69 

Parcel-Post — Rules  Governing  ...  71 
Foreign  Exchange — Monetary  Values.  81 
Local  Weights  and  Measures  (See  also 

Metric  Weights  and  Measures.)     .     85 
Salesmen's  Licenses 88 


91 


Samples — Rules  Governing  Custom 
Entry 

Branch  Offices  of  American  Companies 
— Requirements  in  Connection  There- 
with   97 

Cost  of  Travel  From  New  York,  to  and 
in  Bolivia 102 

Important  Information  Covering  Ship- 
ments   in 

BRAZIL 

Branches  7 

Examination   of  Merchandise   Before 

Acceptance  of  Draft 33 

Stamp  Charges 36 

Protest  of  Drafts 38 

Release  of  Shipments  from  Custom — 

Documents  Necessary      ....     48 
Bills  of  Lading — Manner  of  Consigning    49 
Bills  of  Lading — Endorsement  Tax     .     49 
Release  of  Shipments  from  Custom  in 
the   Absence   of   Documents — For- 
malities Imposed 50 

Period  and  Conditions  under  which 
Merchandise  May  Remain  in  Cus- 
tom Warehouse  After  Arrival: 

Bahia 59 

Pernambuco 59 

Porto  Alegre 60 

Rio  de  Janeiro 60 

Santos 60 

Storage  Facilities 64 

Insurance  on  Merchandise  under  Un- 

collected  Drafts 66 

Mail  Time  to  and  Period  in  which  Re- 
ply may  be  Expected 69 

Parcel-Post — Rules  Governing       .      .71 

Bahia 74 

Pernambuco 74 

Porto  Alegre 74 

Rio  de  Janeiro 75 

Santos 75 

Foreign  Exchange — Monetary  Values.     81 
Local  Weights  and  Measures    .      .      .85 
(See  also  Metric  Weights  and  Meas- 
ures.) 

Salesmen's  Licenses 88 

Samples — Rules    Governing    Customs 

Entry 91 

Branch  Offices  of  American  Companies 
— Requirements  in  Connection  There- 
with   93 

Cost  of  Travel  from  New  York  to  and 

in  Brazil 102 

Local  Manufacturing no 

Important  Information  Covering  Ship- 
ments .  ....  112 


[122] 


INDEX 


CHILE 

Branches  7 

Examination   of  Merchandise   Before 

Acceptance  of  Draft 34 

Stamp  Charges 36 

Protest  of  Drafts 39 

Release  of  Shipments  from  Custom — 

Documents  Necessary      .     .     .     .     5* 
Bills  of  Lading — Manner  of  Consigning     5 1 
Bills  of  Lading — Endorsement  Tax     .     52 
Release  of  Shipments  from  Custom  in 
the  Absence  of  Documents — Formal- 
ities Imposed 52 

Period  and  Conditions  under  which 
Merchandise  may  remain  in  Cus- 
tom Warehouse  After  Arrival  .  .61 

Storage  Facilities 64 

Insurance  on  Merchandise  under  Un- 

collected  Drafts 67 

Mail  Time  to  and  Period  in  which  Re- 
ply may  be  Expected 69 

Parcel-Post — Rules  Governing  .     .      .75 
Foreign  Exchange — Monetary  Values  .     81 
Local  Weights  and  Measures  ...     85 
(See  also  Metric  Weights  and  Meas- 
ures.) 

Salesmen's  Licenses 89 

Samples — Rules     Governing    Custom 

Entry 91 

BranchOfficesof American  Companies — 
Requirements  in  Connection  There- 
with   95 

Cost  of  Travel  from  New  York  to  and 

in  Chile 103 

Local  Manufacturing no 

Important  Information  Covering  Ship- 
ments   112 

COLOMBIA 

Branches 7 

Examination   of  Merchandise   Before 

Acceptance  of  Draft 34 

Stamp  Charges 36 

Protest  of  Drafts 39 

Release  of  Shipments  from  Custom — 

Documents  Necessary      ....  52 

Bills  of  Lading — Endorsement  Tax     .  52 

Bills  of  Lading — Manner  of  Consigning  52 

Storage  Facilities 64 

Insurance  on  Merchandise  under  Un- 

collected  Drafts 67 

Mail  Time  to  and  Period  in  which  Re- 
ply may  be  Expected 69 

Parcel-Post — Rules  Governing  ...  76 

Foreign  Exchange — Monetary  Values  .  8 1 

Salesmen's  Licenses 89 

BranchOfficesof  American  Companies — 
Requirements  in  Connection  There- 
with    97 


Cost  of  Travel  from  New  York  to  and 
in  Colombia      .......   103 

Local  Manufacturing      .....   no 

Important  Information  Covering  Ship- 


ECUADOR 

Examination   of  Merchandise   Before 

Acceptance  of  Draft    .....     34 

Stamp  Charges    .......     37 

Protest  of  Drafts       ......     39 

Release  of  Shipments  from  Customs  — 

Documents  Necessary      ....     53 
Release  of  Shipments  from  Customs  in 

the  Absence  of  Documents  —  Formal- 

ities Imposed    .......     53 

Bills  of  Lading  —  Manner  of  Consigning  53 
Bills  of  Lading  —  Endorsement  Tax  .  53 
Period  and  Conditions  under  which 

Merchandise  may  remain  in  Customs 

Warehouse  ........     61 

Storage  Facilities       ......     64 

Insurance  on  Merchandise  under  Un- 

collectcd  Drafts     ......     67 

Mail  Time  to  and  Period  in  which  Re- 

ply may  be  Expected  .....     69 

Parcel-Post  —  Rules  Governing  ...     76 
Foreign  Exchange  —  Monetary  Values.     81 
Salesmen's  Licenses  ......     89 

Samples  —  Rules    Governing    Customs 

Entry     .........     92 

BranchOfficesof  American  Companies  — 

Requirements  in  Connection  There- 

with      .........     97 

Cost  of  Travel  from  New  York  to  and 

in  Ecuador       .......   103 

Local  Manufacturing      .....   no 

Important  Information  Covering  Ship- 

ments    .........   112 

GUIANAS 
BRITISH  GUIANA 

Mail  Time  to  and  Period  in  which  Re- 
ply may  be  Expected  .....     69 

Parcel-Post     ........     77 

Foreign  Exchange  —  Monetary  Values  .     81 
Cost  of  Travel  from  New  York  to  Brit- 
ish Guiana        .......   104 

Important  Information  Covering  Ship- 
ments   .........   112 

DUTCH  GUIANA 

Mail  Time  To  and  Period  in  which  Re- 
ply may  be  Expected  .....     69 

Parcel  Post     ........     77 

Cost  of  Travel  From    New  York    to 
Dutch  Guiana  .......   104 

FRENCH  GUIANA 

Mail  Time  to  and  Period  in  which  Re- 
ply may  be  Expected  .....     69 


[123] 


OUR  SOUTH  AMERICAN  TRADE  AND  ITS  FINANCING 


Parcel  Post 77 

Cost  of  Travel  From  New  York  to 
French  Guiana 104 

PARAGUAY 

Examination  of  Merchandise  before  Ac- 
ceptance of  Draft  35 

Stamp  Charges 37 

Protest  of  Drafts 39 

Release  of  Shipments  from  Customs — 

Documents  Necessary       ....     53 
Release  of  Shipments  from  Customs  in 
the  Absence  of  Documents — Formal- 
ities Imposed 54 

Bills  of  Lading — Manner  of  Consign- 
ing ..  54 

Bills  of  Lading — Endorsement  Tax     .     54 
Period   and   Conditions   under   which 
Merchandise  may  Remain  in  Cus- 
toms Warehouse  After  Arrival  .      .     61 

Storage  Facilities 64 

Insurance  on  Merchandise  Under  Un- 

collected  Drafts 67 

Mail  Time  To  and  Period  in  which  Re- 
ply may  be  Expected 69 

Parcel  Post — Rules  Governing  ...     77 
Foreign  Exchange — Monetary  Values  .     81 
Local  Weights  and  Measures    ...     85 
(See  also  Metric  Weights  and  Meas- 
ures.) 

Salesmen's  Licenses 89 

Samples — Rules    Governing    Customs 

Entry 92 

BranchOfficesof  American  Companies — 
Requirements  in  Connection  There- 
with   97 

Cost  of  Travel  From  New  York  To  and 

In  Paraguay 104 

Local  Manufacturing no 

Important  Information  Covering  Ship- 
ments   113 

PERU 

Branches  7 

Examination  of  Merchandise  before  Ac- 
ceptance of  Draft 35 

Stamp  Charges 37 

Protest  of  Drafts 40 

Release  of  Shipments  from  Custom — 

Documents  Necessary      ....     54 
Release  of  Shipments  from  Custom  in 
the  Absence  of  Documents — Formal- 
ities Imposed 55 

Bills  of  Lading — Manner  of  Consigning    54 
Bills  of  Lading — Endorsement  Tax     .     55 
Period   and   Conditions   under  which 
Merchandise  may  remain  in  Custom 
Warehouse  After  Arrival  .     .      .     .61 
Storage  Facilities 65 


Insurance  on  Merchandise  under  Un- 

collected  Drafts 67 

Mail  Time  To  and  Period  in  which  Re- 
ply may  be  Expected 69 

Parcel-Post — Rules  Governing  ...     77 
Foreign  Exchange — Monetary  Values  .     81 
Local  Weights  and  Measures     .      .      .85 
(See  also  Metric  Weights  and  Mea- 
sures.) 

Salesmen's  Licenses 90 

Samples — Rules     Governing    Custom 

Entry 92 

BranchOfficesof  American  Companies — 
Requirements  in  Connection  There- 
with   97 

Cost  of  Travel  From  New  York  To  and 

In  Peru 104 

Local  Manufacturing 1 1 1 

Important  Information  Covering  Ship- 
ments   113 

URUGUAY 

Branches 7 

Examination  of  Merchandise  before  Ac- 
ceptance of  Draft 35 

Stamp  Charges 37 

Protest  of  Drafts 40 

Release  of  Shipments  from  Customs — 

Documents  Necessary      .      .     .      .     55 
Release  of  Shipments  from  Customs  in 
the  Absence  of  Documents — Formal- 
ities Imposed 57 

Bills  of  Lading — Manner  of  Consigning    55 
Bills  of  Lading — Endorsement  Tax     .     55 
Period   and   Conditions   under  which 
Merchandise  may  remain  in  Custom 
Warehouse  After  Arrival  ....     62 

Storage  Facilities 65 

Insurance  on  Merchandise  Under  Un- 

collected  Drafts 68 

Mail  Time  To  and  Period  in  which  Re- 
ply may  be  Expected 69 

Parcel-Post — Rules  Governing      .      .     78 
Foreign  Exchange — Monetary  Values      81 
Local  Weights  and  Measures  .     .      .85 
(See  also  Metric  Weights  and  Mea- 
sures.) 

Salesmen's  Licenses 90 

Samples — Rules     Governing    Custom 

Entry 92 

BranchOfficesof  American  Companies — 
Requirements  in  Connection  There- 
with   98 

Cost  of  Travel  From  New  York  To  and 

In  Uruguay 104 

Local  Manufacturing 1 1 1 

Important  Information  Covering  Ship- 
ments   113 


[124] 


INDEX 


VENEZUELA 

Branches 7 

Examination  of  Merchandise  before  Ac- 
ceptance of  Draft 35 

Stamp  Charges 37 

Protest  of  Drafts 40 

Release  of  Shipments  from  Custom — 

Documents  Necessary      ....     57 
Release  of  Shipments  from  Custom  in 
the  Absence  of  Documents — Formal- 
ities Imposed 57 

Bills  of  Lading — Manner  of  Consigning     57 
Bills  of  Lading — Endorsement  Tax     .     57 
Period   and   Conditions   under  which 
Merchandise  may  remain  in  Custom 
Warehouse  After  Arrival  ....     63 

Storage  Facilities 65 

Insurance  on  Merchandise  under  Un- 
collected  Drafts  .     68 


Mail   Time  To  and  Period  in   which 

Reply  may  be  Expected  ....     69 
Parcel-Post — Rules  Governing  ...     79 
Foreign  Exchange — Monetary  Values.     81 
Local  Weights  and  Measures    .      .      .85 
(See  also  Metric  Weights  and  Meas- 
ures.) 

Salesmen's  Licenses 90 

Samples — Rules     Governing    Custom 

Entry •      •     93 

BranchOfficesofAmerican  Companies — 
Requirements  in  Connection  There- 
with   98 

Cost  of  Travel  From  New  York  To  and 

In  Venezuela 105 

Local  Manufacturing ill 

Important  Information  Covering  Ship- 
ments   113 


[125] 


One  Man  cannot  move 
a  Mountain 

NO  longer  does  one  man  finance  a  great 
enterprise  —  thousands  of  investors 
pull  together  with  their  money  and  con- 
fidence. 

It  is  the  business  of  the  National  City 
Company,  through  its  more  than  fifty 
offices  in  leading  cities,  its  trained  repre- 
sentatives, and  by  correspondence,  to  bring 
the  investor  and  investment  opportunities 
together  quickly  and  conveniently. 

A  large  number  of  attractive  offerings 
appear  on  our  current  purchase  sheet. 
Send  for  SZ  136. 


Facts  for 

CAREFUL  INVESTORS 

OUR  book  "Men  and 
Bonds,"  giving  in- 
formation on  the  follow- 
ing subjects  will  be  sent 
gladly  on  request. 

Why  we  handle  only  carefully 
investigated  investment  se- 
curities. 

The  wisdom  of  purchasing 
securities  from  a  Company 
large  enough  to  maintain 
far-reaching  investigation 
service. 

The  importance  of  buying  in- 
vestment securities  from  a 
house  with  over  so  offices 
and  international  connec- 
tions and  service. 

Why  the  careful  investor  se- 
lects securities  from  a  broad 
range  of  offerings. 

How  10,000  miles  of  National 
City  Company's  private 
wires  keep  our  offices  in 
leading  investment  centers 
of  the  country  in  constant 
touch  with  our  New  York 
headquarters. 

Your  advantage  in  dealing 
with  a  Company  whose  rep- 
resentatives talk  with  an 
average  of  3,000  banks  a 
day. 

Why  these  sales  representa- 
tives are  especially  qualified 
to  helpfully  discuss  your  in- 
dividual investment  needs. 

For  a  copy  of  this  book, 
address  our  New  York 
office,  asking  forsz  139. 


THE  NATIONAL  CITY  COMPANY 


NATIONAL 

CITY  BANK  BUILDING 

NEW  YORK 


BONDS 

PREFERRED  STOCKS 
ACCEPTANCES 


